A N N U A L R E P O RT & A C C O U N T S
2 0 0 2
“I am pleased that our overall performance exceeded
the forecast in our previous trading statements.
Although Sunbelt suffered a modest decline in
operating profit this was a strong performance in
difficult conditions as the US economy slipped into
Contents
1
2
4
8
Financial highlights
Chairman’s report
Chief executive’s review
Financial review
recession, particularly after September 11. A-Plant is
Operational reviews:
now under new management and has reorganised its
18 Sunbelt
20 A-Plant
structure and its fleet. The current number of rental
22 Ashtead Technology Rentals
contracts is at its highest level in the UK for six
months and in the US since last September.”
“A-Plant is now in a much stronger position to
compete and increase its market share. The
recession of the early nineties was a catalyst for the
growth of the rental market in the UK. In the same
way, the current US recession is likely to prompt the
acceleration of the shift from ownership to rental. This
24 Directors
25 Advisers
26 Directors’ report
29 Corporate Governance Report
32 Remuneration Committee Report
38 Statement of Directors’ Responsibilities
39 Auditors’ report
40 Consolidated profit and loss account
41 Consolidated balance sheet
42 Company balance sheet
43 Consolidated cash flow statement
44 Notes to the financial statements
will give Sunbelt a huge opportunity over the next few
63 Seven year history
years to continue to increase its current estimated
2.5% share in a market independently forecast to
grow faster than the US economy as a whole.”
64 Senior staff and locations
69 Future dates
George Burnett,
Chief Executive, Ashtead Group plc.
Financial highlights
Turnover up 6% to £583.7m (2000/1 - £552.0m)
Profit before exceptional items, goodwill amortisation and taxation of £28.9m
(£41.2m) with second half ahead of trading statement forecasts
EPS of 6.2p (8.9p) based on above profits and a notional 30% tax charge
After mainly non-cash exceptional charges and goodwill, the FRS 3 loss before
tax is £15.5m (profit of £11.1m) and the profit after tax is £3.7m (£2.2m)
FRS 14 EPS of 1.1p (0.7p)
Recommended final dividend of 2.88p per share maintaining the full year
dividend of 3.5p
Net cash inflow from operations up 17% to £202.0m (£173.0m)
Like for like debt* repayment of £48.5m in the year
Bank covenants renegotiated in April to provide greater flexibility
US continues to outperform its competitors and 23 new profit centres opened
Benefits emerging from new UK strategy
*Net bank debt plus bills of exchange
RENTALS
Ashtead Group plc 1.
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Chairman’s Report
Results
In its trading statements of March and May, the Board
per share). This represents an effective cover of 2.3 times on a
envisaged a broadly breakeven second half to add to the
cash basis (given that goodwill amortisation, the exceptional
£25.8m profit before exceptional items, goodwill amortisation
loss from the UK asset disposal programme and deferred
and taxation earned in the six months to 31 October 2001. In
taxation are non-cash items).
the event the final outcome for the year was £28.9m. This
compares with a profit before exceptional items, goodwill
Board
amortisation and taxation of £41.2m in the previous year. This
The past two years have seen unprecedented change in the
decline reflects recessionary conditions in the Group’s largest
composition of the Group Board. Three of the four executive
market, the United States, and a disappointing performance in
directors, Bruce Dressel, Ian Robson and Sat Dhaiwal, joined
the UK and Ireland.
the Board in February 2000, June 2000 and March 2002
respectively. Chris Cole joined as an independent non-
In the former case, however, there is clear evidence that
executive director in January 2002 and I became your
Sunbelt is outperforming its major competitors; in the latter,
chairman in August 2001. I should like to welcome Sat and
steps have been taken to secure improved performance by A-
Chris, who both joined in the past year, to the Board.
Plant.
Additionally George Burnett stepped up to become chief
Group revenues increased by 6% to £583.7m (£552.0m). After
business successfully through a highly challenging past twelve
executive of the Group in February 2000 and has managed the
exceptional costs, principally the loss on the asset disposal
months.
programme announced last September and a tax credit
(principally of deferred tax under FRS 19) of £19.2m, there was
July 2001 saw the retirement of Peter Lewis, the Company’s
an after tax profit of £3.7m (2000/1 - £2.2m) giving earnings
long serving chairman who co-founded the Company with
per share 1.1p (0.7p). Earnings per share based on the
George Burnett in 1984. We also said goodbye to Ted
£28.9m profit before exceptional items, goodwill amortisation
Forshaw who resigned as a director in March 2002 after many
and taxation and a notional tax rate of 30 per cent were 6.2p
years service with A-Plant. Our thanks go to both of them.
per share (8.9p).
Dividend
Staff
Difficult years often bring out the best in a team and this year
During the Group’s 15-year history as a public company, the
the Group’s staff have risen to an immense challenge. The
dividend has been increased every year except one. That was
Board’s appreciation and thanks are due to all of them.
ten years ago, in the middle of the severe UK recession, when
the previous year’s level was maintained. After nine years of
dividend growth the Board believes an unchanged dividend to
be again appropriate for the current year. A final dividend of
2.88p per share is therefore proposed, giving an unchanged
total for the year of 3.5 pence per share (2000/1 - 3.5 pence
Henry Staunton
Chairman
8 July 2002
Ashtead Group plc 2.
Ashtead Group plc 3.
Chief Executive’s Review
After a long period of growth, it is always difficult to report a
growth of 3.3%. As a result, it was able to consolidate its
disappointing profit performance. Only once before in our
number 5 position in the $23bn US rental market as Sunbelt
eighteen-year history have we encountered a similar situation,
and the market leader were the only major players to achieve
when we faced the UK recession of a decade ago. Then we
any like-for-like growth. Although Sunbelt suffered a modest
looked to maximise the long-term future of the Company, not
decline in operating profit, this was a strong performance in
by closing businesses and wholesale lay-offs, but by
difficult market conditions as the US economy slipped into
continuing to invest selectively, competing aggressively in the
recession, particularly after September 11. Operating margins,
market place and generating cash. We have applied the same
at a still healthy 14.9% given the trading conditions, were also
principles in the current US recession. In the UK we have
adversely affected by the drag effect of opening 23 new
completed a fundamental review of the business with a view to
locations during the year. Of these, 5 were “warm starts” -
improved and sustainable returns.
small bolt-on acquisitions - with the remainder being greenfield
Sunbelt
openings. With the BET acquisition fully integrated into the
Sunbelt network and culture, the process of infill was started.
Sunbelt Rentals, our US business, increased its revenues by
Of the 23 new businesses, 17 were in areas supporting the
10.6% from £345.7m to £382.2m, achieving same store
former BET businesses. Sunbelt further consolidated its
Ashtead Group plc 4.
current position and its future potential in the US rental market by
profit accountability. The regional businesses in turn have been
being the only major player not to have a depot closure
more closely focused on tool hire and general equipment at the
programme.
national and local level and there has been an infusion of new
management talent at the most senior level within the Company.
Capital expenditure on rental equipment in the year was £67.0m,
significantly below the 2000/1 figure of £146.3m, and in line with
Two significant steps have been taken to secure additional
its rental fleet depreciation of £67.4m. Fleet utilisation was
revenues. The major accounts team, which has been successful
maximised by meeting 64% of the capital needs of the 23 new
in growing our business through sole and preferred supply
businesses from existing resources (18% for 10 new businesses in
agreements with national customers such as Transco and large
2000/1).
A-Plant
regional players, has been increased from two to twelve.
Secondly, A-Plant’s small equipment businesses have been given
a separate “Tool Hire Shops” identity and the rollout of this brand
The past year was a difficult one for A-Plant. A marginal (0.9%)
is already under way.
increase in first-half turnover was followed by an 8.8% fall in the
seasonally slower second half and led to an annual decline in
Capital expenditure on the rental fleet, significantly reduced since
turnover of 3.9% to £187.0m (£194.5m) and a £12.1m reduction in
October 2000, was kept under tight control, amounting to £26.7m
operating profits to £13.0m due to the effects of operational
(2000/1 - £67.0m). This compared with depreciation on the rental
gearing. Hire companies, such as A-Plant, with a significant
fleet of £40.6m.
customer base outside the construction industry have encountered
a more difficult market, particularly in the manufacturing sector. In
Ashtead Technology
A-Plant’s case, the strategic decision to discontinue lower margin,
Ashtead Technology increased its turnover by 22.9% in the year to
high-risk business and to rationalise its fleet also contributed to
£14.5m, of which like-for-like growth from the survey and
the reduction in turnover. This major logistical exercise, though a
inspection division was 11%. The year to 30 April 2002 was the
short-term distraction from its very scale, was completed on
first full year of ownership of the environmental testing division
schedule by the year-end.
acquired in October 2000. This division, although entirely based in
North America, held up well throughout the year achieving like-for-
In March, Sat Dhaiwal, newly appointed Chief Executive of A-
like sales up 3%. More importantly, its rental revenues increased
Plant, led an exhaustive review of the entire A-Plant rental fleet,
by 17% reflecting reduced emphasis on lower margin sales
including a physical examination of every asset not on hire to a
business.
customer. As a result, a number of under performing assets were
added to the disposal programme taking the total exceptional
In the Survey and Inspection Division, the Far East and Australian
charge to £32.6m. At the same time, A-Plant has been
markets were strong with offshore field development more than
restructured. As a result of the changes, the specialist businesses,
replacing subsea cable business lost in the collapse of the telecom
such as Powered Access, Accommodation, Rail, Welding and
market. The North Sea and Gulf of Mexico were slower in the
Power Generation, have been removed from the regional structure
second half although West Africa and Brazil provided some
and are now managed by experts in their field who hold national
counterbalance.
Ashtead Group plc 5.
Chief Executive’s Review
Overall operating profits rose 13.8% in the year to £4.1m, with
the Group’s banking agreements). Further substantial pay
operating margins of 28.3% remaining strong.
down of debt is anticipated in 2003 and 2004.
Financial
The Group operates mostly from leasehold properties. It
Total capital expenditure in the year was £113.8m, less than
manages its fleet of cars and commercial vehicles on a
half the previous year’s figure of £237.7m. The average age of
contract hire basis. It also has operating lease arrangements
the rental fleet at 30 April 2002 was 41 months against an
for minor items such as photocopiers and faxes. It has no
average working life for the equipment in the fleet of over 100
other form of off balance sheet financing.
months. As noted above, the net cash inflow from operations
in the year was a record £202.0m (£173.0m). This facilitated a
The Group did not breach any of its quarterly banking
like for like reduction of £48.5m of senior debt (as defined by
covenants in the year. However, given the changed economic
Ashtead Group plc 6.
circumstances in the United States, the Group requested greater
investing in new businesses, Sunbelt has maintained its revenue
flexibility in its covenant package. The requested adjustments
line - crucial in a fixed cost business - just as the Group did a
were unanimously approved by the Company’s bank group in
decade ago in the UK recession. A further five new profit centres
April. Total headroom against the Group’s banking facilities as at
are planned for the coming year. The recession of the early
30 April 2002 was £66.8m.
nineties was a catalyst for the growth of the rental market in the
UK and of A-Plant in particular. In the same way, the current US
The £19.2m tax credit for the year incorporates a minimal current
recession is likely to prompt an acceleration of the shift from
tax charge and a deferred tax credit relating to the structure
ownership to rental and give Sunbelt a huge opportunity over the
created to fund the BET acquisition. In cash flow terms the level
next few years to continue to increase its current estimated 2.5%
of cash tax payments will be significantly less than ten per cent of
share in a market independently forecast to grow faster than the
profits for the foreseeable future.
US economy as a whole.
George Burnett
Chief Executive
8 July 2002
Current trading & future prospects
Although the current number of rental contracts is at its highest
level in the UK for 6 months and in the USA since last September,
group turnover for the two months ended June 2002 was 6%
down on a year on year basis at actual rates of exchange and 3%
down at comparable rates of exchange, reflecting the fact that
comparative group revenues declined throughout last year as
economic conditions deteriorated. In the coming year, the Board
anticipates the reverse of this trend with year on year growth
expected to improve as the year progresses.
In the UK and Ireland, determining the future progress of the
economy remains uncertain although overall a modest
improvement is expected over the next 12 months. What is more
certain is that A-Plant has in the past year addressed issues it
needed to confront and is in a much stronger position to compete.
Ashtead Technology should continue to make progress, although
the offshore market will remain patchy in the coming months.
In the United States, the Board expects the market to be generally
flat for the rest of 2002 with the possibility of improving conditions
in early 2003. Sunbelt should, however, continue to gain market
share. By retaining the integrity of its profit centre structure and
Ashtead Group plc 7.
Financial Review
Profit & loss account
Revenue
Staff costs
Total revenue grew by 5.7% to £583.7m. Sunbelt Rentals’
Staff costs constitute the largest single expense of the
revenue increased from £345.7m to £382.2m, a rise of 10.6%
business and grew from £170.2m to £194.0m. Excluding
of which 5.5% was derived from the inclusion of BET USA
growth in scaffold erection and dismantling staff costs, where
(acquired 1 June 2000) revenues for an additional month in the
there is a directly equivalent growth in revenue, staff costs
current year. Same store revenues, being revenues from
grew 6.8% to £160.0m (£149.8m) reflecting the additional
profit centres open throughout both financial years, grew
month of BET USA included this year and the 23 new profit
3.3%. A-Plant’s total and same store revenues declined 3.9%
centre openings in Sunbelt. The average number of
from £194.5m to £187.0m whilst Ashtead Technology’s
employees has increased from 5,834 to 6,393 with 6,545 on
revenues grew 22.9% from £11.8m to £14.5m with same store
the payroll at 30 April 2002. Staff costs include profit share
revenues growing 11.0%.
paid of £9.0m (£13.2m).
Depreciation and gain on sale of fixed assets
Rental equipment Other assets
£m
£m
Sunbelt Rentals
A-Plant
Technology
67.4
40.6
4.2
112.2
Total
£m
71.0
45.7
4.2
2001
£m
60.4
50.1
4.0
3.6
5.1
-
8.7 120.9
114.5
The gain on sale of assets in the ordinary course of trading this
year was £1.5m compared with £6.8m in the previous year.
Ashtead Group plc 8.
Segmental performance
Revenues
Operating profit less finance
lease interest
2002
£m
2001
£m
2001
£m
2002
£m
382.2
187.0
14.5
-
-
-
345.7
194.5
11.8
-
-
-
56.9
13.0
4.1
-
1.7
-
583.7
552.0
75.7
(39.2)
(7.6)
28.9
41.2
64.1
25.1
3.6
(2.5)
(1.7)
-
88.6
(40.8)
(6.6)
Net assets
2002
£m
652.5
245.5
12.9
-
-
(716.4)
194.5
2001
£m
(restated)
615.8
283.6
12.2
-
(31.2)
(678.3)
202.1
* Net bank debt, finance
lease obligations and
convertible loan note plus
deferred taxation
Sunbelt Rentals
A-Plant
Ashtead Technology
Redundant BET staff salaries
Prior year lease impact
Central items *
Bank interest payable
Convertible loan note interest
Profit before exceptional items,
goodwill amortisation & taxation
This year the segmental analysis of profitability by business is
Net assets employed declined in A-Plant, reflecting the impact of
based on the operating profit before exceptional items and
the disposal programme, whereas the rise in Sunbelt relates to
goodwill amortisation of £81.3m less finance lease interest of
investment in expansion at its existing profit centres and to the net
£5.6m because this provides a better comparison between this
capital expenditure of £11.8m in the 23 new profit centres this year
year and last following the capitalisation this year of acquired BET
(comprising gross expenditure of £33.1m less equipment
leases. Adjustment has also been made for the prior year effect of
transferred from other profit centres of £21.3m).
the revised treatment. These adjustments are discussed further
under acquisitions below.
Exceptional loss on disposal
The exceptional loss on disposal arose as a result of the
On this basis, Sunbelt’s profits declined by £7.2m in the year,
programme, originally announced at the 2001 Annual General
reflecting the impact of the US economic downturn which was
Meeting on 8 October 2001, to dispose of surplus assets in A-
particularly noticeable in the second half. A-Plant’s profits fell by
Plant. The increase of £2.6m in the final cost from the £30.0m
£12.1m reflecting its 3.9% revenue decline and the
estimated at the half year reflects further analysis undertaken by
competitiveness of its main markets. Technology continued to
Sat Dhaiwal and the new A-Plant management team following his
grow strongly although its second half was affected by the weak
appointment on 4 March 2002. All assets subject to the
offshore market in the Gulf of Mexico and by a slow start to the
programme have now been sold and the programme was
season in the North Sea.
completed on schedule by year-end.
Ashtead Group plc 9.
Financial Review
Net interest payable and similar charges
adjustments made to bank covenants in July 2001 consequent
Bank interest payable (net)
Accrued interest amortisation on
convertible loan note
Interest payable on finance leases
Exceptional costs re bank facility
2002
£m
39.2
7.6
5.6
52.4
3.0
55.4
2001
£m
40.8
6.6
-
47.4
9.7
57.1
upon adoption of new accounting policies and estimation
techniques under FRS18 in the 2001 accounts and (ii) the
adjustments made to bank covenants in April 2002 to provide
greater future financial flexibility in light of the impact of the
downturn in the US economy.
Profit/loss before tax
The result before tax under FRS 3 was significantly impacted
by the UK exceptional loss to produce a loss of £15.5m
Bank interest payable relates primarily to the interest payable
(2000/1 - profit of £11.1m). Before exceptional items and
on the variable rate, secured bank facility. Interest is payable
goodwill amortisation, the profit before tax was £28.9m
under this facility at an average premium of 250 basis points
(2000/1 - £41.2m).
The reconciliation between these figures is as follows:
over three month LIBOR for the currency in which the loan is
drawn. Interest on US$250m of this bank debt has been fixed
at 6.825% by three year forward interest rate agreements
entered into in August 2000. The impact of these swaps is
recognised rateably over their life as part of bank interest
Profit before tax before exceptional
items and goodwill amortisation
payable. The average borrowing rate experienced during the
Exceptional UK loss on disposal
year on bank borrowings (including the premium) was
Exceptional BET USA integration costs
approximately 7% (2000/1 - 9%) reflecting predominantly
Exceptional costs re bank facility
lower US interest rates.
Goodwill amortisation
2002
£m
28.9
(32.6)
-
(3.0)
(8.8)
2001
£m
41.2
-
(12.3)
(9.7)
(8.1)
(Loss)/profit before taxation
(15.5)
11.1
Although no cash interest was payable on the convertible loan
until the first anniversary of its issue (i.e. from 1 June 2001),
Taxation
accounting standards required the loan, which has a par value
Reflecting one of the benefits of the capital intensive nature of
of £134m, to be recorded at its fair market value at date of
the Group’s operations the current tax charge for the year
issue and then amortised to bring the loan up to its £134m par
continues to be very low at £0.6m. There was also a prior
value over its eight year life. This resulted in a non-cash
year credit for current tax of £0.9m reflecting cautious
interest charge of £6.6m in 2000/1 and an interest cost this
provisioning now released following agreement of the tax
year which reflects not only the 5.25% fixed interest amount
computations for the affected years. The effective current tax
actually payable to the loan note holder (£7.0m per annum) but
rate is expected to remain at very low levels (significantly less
also a further annual non-cash charge of approximately £0.6m.
than ten percent) for the foreseeable future due to the
continuing availability of tax losses in the US and unclaimed
Exceptional costs in relation to the bank facility in 2002
tax depreciation in the UK and to benefits arising from the
comprise variation fees payable in connection with (i) the
structure of the BET USA acquisition.
Ashtead Group plc 10.
The new UK standard on deferred tax, FRS 19, which requires
fund the BET USA acquisition not previously recognised but, in
full provision to be made for deferred tax as opposed to the
this case, for benefits in respect of the 2000/1 year. Overall
partial provision method previously applicable under SSAP 15,
the total tax credit for the year is £19.2m of which £0.3m is the
came into effect this year. Adoption of FRS 19 has been dealt
net current tax credit and £18.9m is the deferred tax credit
with as a prior period adjustment and increases the deferred
(2000/1 - a total restated tax charge of £8.9m).
tax provision at 30 April 2001 from £4.0m previously reported
to a restated £66.0m at that date and to £41.1m at 30 April
Earnings per share
2002 but has no impact on the amount of tax the Group will
Basic earnings per share computed by reference to the FRS 3
actually pay in years to come.
result was 1.1p per share (2000/1 - 0.7p per share). Earnings
Under FRS 19 the Group’s full year effective tax rate (for the
items and goodwill amortisation and a notional tax rate of 30
current year element of the tax charge) is 11%, which is lower
per cent were 6.2p per share (2000/1 - 8.9p per share).
per share computed on the pre-tax profit before exceptional
than the UK statutory rate due to tax benefits arising from the
structure set up to fund the BET USA acquisition. It is also
Dividend
lower than the effective tax rate estimated at the half year
Subject to approval of the final dividend by shareholders, the
because of revisions to the assumptions underlying the
dividend per share has been maintained at 3.5p per share for
calculation of these benefits. The prior year deferred tax credit
the year as a whole. If approved, the final dividend of 2.88p
also relates to tax benefits deriving from the structure used to
per ordinary share will be paid on 30 September 2002.
Ashtead Group plc 11.
Financial Review
Balance sheet
Fixed assets
Total additions to fixed assets in the year were £113.8m (2001
- £237.7m) of which £98.0m (2001 - £217.5m) was spent on
rental equipment as follows:
2002
Expansion Replacement
£m
£m
30.8
10.6
3.4
44.8
36.2
16.1
0.9
53.2
Total
£m
67.0
26.7
4.3
98.0
2001
Expansion Replacement
£m
£m
91.0
36.3
3.3
130.6
55.3
30.7
0.9
86.9
Total
£m
146.3
67.0
4.2
217.5
Sunbelt
A-Plant
Technology
Capital expenditure was less than half that of 2001 reflecting
the Group have improved from 64 days last year to 58 days at
the US economic slowdown and the continuation of the policy
30 April 2002. The bad debt charge as a percentage of
of restricting UK investment in place since October 2000. For
turnover was 1.4% (2001 - 1.2%).
the first time since the UK recession of the early nineteen
nineties, capital expenditure at £113.8m was lower than the
Trade and other creditors
depreciation charge of £120.9m.
Group creditor days declined from 132 days at 30 April 2001
to 85 days at 30 April 2002 reflecting the lower capital
Despite lower capital expenditure, the Group retains a
expenditure this year. Suppliers continue to be paid in
relatively young rental fleet with an overall age at 30 April 2002
accordance with the individual payment terms agreed with
of 41 months (comprising Sunbelt of 41 months and A-Plant of
each of them. The total amount payable within trade creditors,
43 months). In the coming year the Group currently
bills payable and accruals at 30 April 2002 directly attributable
anticipates that capital expenditure will again fall below the
to the purchase of rental equipment is £60.7m (2001 -
level of the depreciation charge and will amount to
£150.2m).
approximately £75m. This will still be sufficient to complete a
significant replacement programme and gives an estimated
Acquisitions
average overall fleet age of 49 months at 30 April 2003
Note 22 to the accounts summarises the goodwill on
compared with the estimated average working life for the
acquisition arising in the year. This comprises goodwill of
equipment in the fleet of over 100 months.
£2.8m arising on two small acquisitions made in the year by
Current assets
centres in the year and £2.5m related to adjustments made to
Stocks of resale items, parts and consumables reduced by
the provisional fair values established last year in respect of
Sunbelt, which contributed 5 profit centres of its 23 new profit
15.7% to £12.9m (2001 - £15.3m) and trade debtors were
the BET USA acquisition.
11.9% lower at £110.7m (2001 - £125.7m). Debtor days for
Ashtead Group plc 12.
The largest of these adjustments relates to capitalising
As described under Segmental performance above, we have
acquired rental equipment held under leases entered into by
based this year’s analysis of profitability by business on the
BET USA in the period from 1997 to 1999. As we completed
operating profit before exceptional items and goodwill
the hindsight review of the acquired BET assets required this
amortisation less finance lease interest to reflect the change in
year by accounting standards, it became apparent that the
accounting treatment applied to the leased assets this year.
terms of these leases were such as to make it highly
uneconomic to return the equipment to the lessor at the
Cash flow and net debt
conclusion of their minimum committed term because the total
Net cash inflow from operations rose 16.8% to £202.0m
amount paid under the lease in these circumstances
(2000/1 - £173.0m). This reflected good control of working
substantially exceeds the reduction in market value of the
capital, particularly receivables, throughout the year.
equipment in the lease period and a reasonable interest cost.
Instead the alternative option of buying out the leases or
Interest paid in the year rose to £50.4m (2000/1 - £46.4m) and
extending the initial lease term is significantly more economic.
there was a small tax payment of £0.7m (2000/1 - refund of
£1.7m). Cash payments to acquire fixed assets were at a
Although these leases were treated as off balance sheet
similar level to the previous year (£203.3m v £202.6m in
operating leases by BET USA, our view is that it is more
2000/1) due to the delayed effect of the payment terms the
appropriate to treat them as finance leases under the relevant
group enjoys with its rental fleet suppliers.
UK leasing standard, SSAP 21. Applying this treatment has
resulted in our bringing these leased assets and the related
In the forthcoming year, the halved level of capital expenditure
finance lease obligations onto the balance sheet. It also
in 2001/2 compared with 2000/1 will result in payments to
means that, unlike most of Sunbelt’s quoted US competitors
acquire fixed assets broadly halving from this year’s £203.3m
(who use off balance sheet leases fairly extensively), all of the
and will mean that cash payments to acquire fixed assets will
Group’s rental fleet is now on balance sheet.
be below the depreciation charge in 2002/3, contributing
significantly to the Group’s debt reduction plans.
As explained further in note 22 to the accounts, as a
consequence of this treatment, the 2001/2 profit and loss
Despite the lower expenditure on acquiring fixed assets,
account includes not only the depreciation and finance lease
proceeds earned from the sale of fixed assets increased from
interest relating to the current year for these leases but also
£38.3m to £39.2m. This, however, included proceeds of
the equivalent amounts for the 11 months ended 30 April 2001
£4.9m from the UK disposal programme (less disposal costs of
offset in that case by the rentals paid for the same period
£1.1m) and £8.8m generated in the first half from the UK
which were previously expensed as incurred as operating
vehicle fleet which was moved onto a serviced lease basis
lease rentals. The net effect is that 2001/2 profits before
similar to that already used by Sunbelt Rentals. Net of these
taxation include a net credit of £1.4m (£1.7m before goodwill
non-recurring factors disposal proceeds totalled £26.6m, still a
amortisation) which would have been accounted for in the 11
good result relative to the £38.3m of 2000/1 in a year when
months ended 30 April 2001 had the leases been treated as
capital expenditure on new assets more than halved.
finance leases in that year.
Ashtead Group plc 13.
Financial Review
Net debt
Net bank debt
Bills of exchange
Net bank debt and bills of exchange
2002
£m
515.0
11.6
526.6
5.25% convertible loan note, due 2008
129.7
Finance lease obligations
656.3
30.6
Total debt including bills of exchange
686.9
2001
£m
484.4
90.7
575.1
127.9
703.0
-
703.0
Increase/(decrease)
£m
30.6
(79.1)
(48.5)
As forecast in the interim statement, net bank debt peaked at
long term secured multi-currency loan facility entered into at
31 October 2001 at £527.6m. The reduction in the second half
the time of the BET acquisition on 1 June 2000. Interest is
from this figure was £12.6m.
payable on this facility at variable rates linked to underlying
market rates traded in the London interbank market.
Taking net bank debt and bills of exchange (the form in which
much of the long credit terms provided by equipment vendors
At 30 April 2002 £506.7m (2001 - £483.0m) was drawn under
is held) together - which is the measure of senior debt used
the facility with the remainder of the commitment (£56.9m)
under our banking agreements - debt was reduced by £48.5m
undrawn. £254.4m is drawn under a seven year medium term
over the year as a whole. This comprised a reduction of
loan committed to 1 June 2007 with the remainder (£252.3m)
£29.1m in the first half and a further reduction of £19.4m in the
drawn under a 364 day revolving credit agreement which is
seasonally weaker second half of the year.
committed until 1 June 2005. The facility is repayable at
maturity except that there is a notional 1% amortisation of the
Including finance lease obligations on the BET USA equipment
term loan each year on the anniversary of its issue (US$3.75m)
rental leases which have now been brought on balance sheet
and the revolving facility reduces in two tranches of US $50m
as discussed under acquisitions above and the 5.25%
each on 1 June 2003 & 2004. Accordingly both the amounts
unsecured, convertible loan note, due 2008, total debt was
drawn under the medium term loan and under the revolving
£686.9m at 30 April 2002 (2001 - £703.0m).
credit agreement are presented in the balance sheet under
The halved capital expenditure in the year to 30 April 2002 and
the 1% medium term loan amortisation due on 1 June 2002)
the £75m capital expenditure currently anticipated for the year
because the year end drawings under the revolving credit
to 30 April 2003 are expected to produce further and
facility were replaced by new drawings under the same
accelerating debt repayments in 2002/3 and 2003/4.
committed facility when they matured.
creditors due in more than one year (other than in respect of
Bank loan facilities
The facility is secured by means of fixed and floating charges
The Group’s principal bank facility is the US $825m committed
over substantially all of the Group’s assets. Under the terms
Ashtead Group plc 14.
of the facility, the Group is required to demonstrate compliance
This new source of funding, which is committed until the revolver
with certain financial covenants comprising the ratios of EBITDA to
commitment date of 31 May 2005, carries an effective funding
interest and to senior and total debt levels and the ratio of debt
cost of approximately 135 basis points over US dollar LIBOR
levels to the value of tangible assets on a quarterly basis. None of
which compares to the average premium of 250 basis points on
these quarterly covenants was breached during the year ended 30
borrowings under the senior credit facility - £60m of which was
April 2002. Adjustments to the covenants were agreed
repaid on a pro-rata basis with the agreement of the Company’s
unanimously by the bank group in April 2002 to provide greater
bank group concurrently with the initial funding of the
financial flexibility in the light of the US economic downturn.
securitisation programme which raised £59.4m.
The Group also has two secured but uncommitted bank overdraft
The securitisation programme therefore provides both a significant
lines provided alongside the main secured facility. At 30 April
reduction in the level of Ashtead’s borrowings under the Senior
2002 £8.5m was outstanding under these facilities leaving £9.9m
Credit Agreement and a new source of funding at lower cost.
undrawn. Thus headroom at 30 April 2002 under all the Group’s
facilities (committed and uncommitted) was £66.8m.
Pensions
The Group operates pension plans for the benefit of its employees
5.25% unsecured convertible loan note, due 2008
and made contributions totalling £2.7m to these plans in the year.
Part of the consideration for the BET USA acquisition was satisfied
These plans are defined contribution plans except for the plans
by the issue of the £134m nominal value 5.25% unsecured
covering UK employees which were operated on a defined benefit
convertible loan note, due 2008 which is currently held by the
basis. Take up rates amongst UK employees have historically
vendor, Rentokil Initial PLC. No interest was payable on this loan
been low with only 661 UK employees out of a total of 2,511 being
note in its first year of issue but from 1 June 2001 it has borne
contributory members of the plan at 30 April 2002.
interest at a fixed discounted rate of 5.25% per annum. It is
convertible into 89.3m ordinary shares at any time after 1 June
Pension plan provision in the UK was reviewed during the year as
2001 at the holder’s option (giving an effective conversion price of
a result of which it was determined to close the existing UK
150p per share) and is repayable at par in June 2008 if not
defined benefit plan to new members and to offer a new defined
previously converted. Rentokil are unable to transfer the
contribution plan to UK staff compliant with the UK Government’s
convertible without Ashtead’s consent and certain orderly
stakeholder initiative. After an extensive briefing and consultation
marketing restrictions also apply to ordinary shares issued through
exercise, 556 employees elected membership of the new plan
conversion.
which commenced operation on 1 May 2002. The Company
provides an employer’s contribution of 5% of salary on a matching
Accounts receivable securitisation
basis to the new plan.
On 14 June 2002 the Company and certain of its subsidiaries
completed a rolling £60m accounts receivable securitisation with
The latest triennial valuation of the existing UK defined benefit plan
Banc of America Securities. Under the securitisation programme,
(as at 30 April 2001) was completed in the year. This showed a
which funded on 20 June 2002, the Group receives non-recourse
deficit of 6% (measured as the shortfall in assets compared with
funding of up to £60m secured against its UK and US receivables.
liabilities) under the best estimate assumptions required to be
Ashtead Group plc 15.
Financial Review
used under SSAP 24 for accounting purposes and 16% under
Financial instruments
the conservative assumptions used by the actuary for funding
The Group’s financial instruments comprise borrowings, some
purposes. In consequence the employer’s contribution was
cash and liquid resources, and various items such as trade
increased from 5% to 11% of salary effective 1 November
debtors, trade creditors and bills of exchange payable, etc.,
2001 which was the level recommended by the actuary to
that arise directly from its operations. The main purpose of
address the funding shortfall.
these financial instruments is to raise finance for the Group’s
This year disclosure is also required for the first time under the
operations.
transitional provisions of the controversial new UK accounting
In addition to the foregoing, on 24 August 2000 Ashtead
standard on pensions (FRS 17) of the actuarial position of the
Group plc entered into forward rate agreements with
plan updated to 30 April 2002. In providing this disclosure,
LloydsTSB Bank plc and Bank of America under which the
FRS 17 requires use of actuarial methods and assumptions
variable interest rates payable under the bank facility on a total
which differ from those used by the actuary for the triennial
of US$250m of borrowings were exchanged for a three year
valuations used for funding purposes. Reflecting these
fixed interest rate of 6.825%.
differences and the poor performance in the past year of the
UK stock market (in which most of the plans’ assets are
Derivative transactions are only undertaken for the purposes of
invested) the deficit in the Company’s defined benefit plans at
managing funding and managing interest rate risk and
30 April 2002 on the basis required by FRS 17 was £7.1m.
currency risk. The Group does not trade in financial
Operating statistics
Profit centre numbers Year end staff numbers
2001
2002
2002
2001
Sunbelt Rentals
A-Plant
Ashtead Technology
Corporate office
188
268
7
-
163
273
7
-
3,886
2,573
71
15
3,471
2,498
61
13
instruments. The main risks arising from the Group’s financial
instruments are interest risk, liquidity risk and foreign currency
risk. The Board reviews and agrees objectives and treasury
policies for managing each of these risks and they are
summarised below.
Interest rate risk management
The Group’s interest rate management policy is to use a
463
443
6,545
6,043
combination of fixed and variable rates of interest to provide
During the year Sunbelt established 23 new depots, including
five through acquisition. Additionally a further two new profit
centres were established to enable specialist activities to be
managed and reported separately from general businesses.
To increase operational efficiency A-Plant merged five
previously separately managed profit centres in the year into
other profit centres operating at the same sites.
some element of protection against sudden changes in the
level of interest rates. New derivative transactions are only
entered into with the authority of the Group’s Finance and
Administration Committee and the Finance Director provides a
regular report on treasury matters to each Board Meeting in
which the need for new derivative transactions is reviewed and
discussed. At 30 April 2002 some 49% of the Group’s
borrowings were at fixed rates (comprising $250m of the bank
Ashtead Group plc 16.
debt on which interest rates have been fixed for three years from
August 2000 as described above and the £134m convertible loan
on which interest is fixed at 5.25%).
Liquidity risk
The Group’s policy is to ensure continuity of funding which is
currently provided through the $825m committed secured loan
facility and the eight year convertible loan with the result that all
the Group’s loan facilities (other than short term overdrafts)
currently have a maturity of at least four years although the
amount available for borrowing reduces by $50m at each of 30
April 2003 and 2004. At 30 April 2002, £56.9m remained undrawn
under the Group’s committed borrowing facilities. The Group
anticipates that borrowing levels will fall in the coming year
reflecting lower levels of capital expenditure.
Foreign exchange risk management
into sterling. Foreign exchange risk on significant non-trading
With a significant portion of the Group’s operations based outside
transactions (eg acquisitions) is considered on an individual basis.
exchange rate movements on the translation of overseas profits
the UK, the Group faces currency risk on its non-sterling net
assets as the translation of overseas subsidiaries can have a
Counterparty risk
considerable effect on the Group’s reported net assets. The main
The Group is exposed to credit risk related losses in the event of
exposures are to the US dollar and the Euro (Irish punt) exchange
non-performance by a counterparty to its interest rate hedging
rates against sterling.
financial instruments. This risk is managed by entering into
derivative transactions only with institutions with a strong credit
The Group seeks to mitigate the effect of these structural currency
rating and by limiting the total exposure to any single counterparty.
exposures by matching the currency of third party borrowings
At 30 April 2002 the counterparties to the Group’s interest rate
against the currency of earnings generated from assets. At 30
hedging transactions were LloydsTSB Bank plc and Bank of
April 2002, total net borrowings of £675.8m were drawn as to a net
America who are not expected to fail to meet their obligations.
£481.6m in US dollars, £15.4m in Euros and £178.8m in sterling.
The Group’s exposure to exchange rate movements on trading
transactions is relatively limited. All Group companies invoice
revenues in their respective local currency and generally incur
expense and, except in the Republic of Ireland, purchase assets in
their local currency. Consequently the Group does not routinely
hedge either forecast foreign exchange exposures or the impact of
Ian Robson
Finance Director
8 July 2002
Ashtead Group plc 17.
Operational Review - Sunbelt Rentals
Markets
This was a year that I believe showed the true skills and
43% over the previous year. This year I believe the Pump and
determination of the US management team in a difficult US
Power team can continue significantly to outperform our
economy. While reacting to the difficult economy we focused
overall growth.
first on the customer and then on matching investment in
rental fleet to current demand.
Another specialist business is Scaffold Services which we
We reduced overall capital expenditure by over 50% and
transferred under-utilised fleet to the 23 new profit centres
opened this year, 5 of which were acquisitions. We achieved
same store sales growth of 3.3% and overall growth of 10.6% in
a year when most of our peers showed both negative same
store sales and overall growth. I am proud of the entire Sunbelt
team and what they have accomplished over the past year.
This coming year we will continue to keep a watchful eye on
capital expenditure while maintaining our strict fleet
replacement policy. Our growth capital will be focused on
products that allow us to expand our product offerings and
broaden our customer range while enhancing return on
invested capital. On 1 May 2002, we completed the
consolidation of our accounting and IT functions from three
regional facilities to one central facility located in Charlotte,
North Carolina. This new efficient structure has allowed us to
deliver a greater level of service to the field while focusing on
continued cost reduction.
During the past year we have increased our profit centre
network from 163 to 188 firmly positioning us in the 26 states
(covering some 75% of the total US population) from which we
now operate. We will continue the process of developing our
general products by clustering profit centres in good markets
whilst also investing in expanding our specialist businesses.
For example, our specialist Pump and Power profit centres
now number 13 stores. Whilst these represented only 5% of
our total revenues in the year, the division grew its revenues
acquired through the BET acquisition and strengthened this
year by acquiring a two branch business in the southeast. It
represented 16% of our total business in the year ended 30
April 2002. We now have what I believe is the most
operationally skilled management team in the US scaffold
industry. There are three things that are exciting about this
business: the higher returns on capital that it delivers; the
overall growth opportunities that it presents; and the access
that it has given, and will continue to allow us, to strategic
industrial customers to whom we can then rent our whole
range of products and services.
Prospects
Entering this year, Sunbelt, on a profit centre by profit centre
basis, is operationally stronger than it has ever been.
Anticipating a flat economy, our plans for the coming year are
for only five greenfield openings, continued focus on
investment in higher return assets and on improving the overall
cost efficiency of our business. Regardless of the economy
we expect, as in this past year, to see continued market share
gains across all key areas of our business.
Bruce Dressel
President and Chief Executive
Sunbelt Rentals
8 July 2002
Ashtead Group plc 18.
RENTALS
Ashtead Group plc 19.
Operational Review - A-Plant
Results
As reported at the half-year, the market in general equipment
as well as real focus on these specialists markets, in many of
rental remained competitive and this, along with our strategic
which we have a top five market position.
decision to reduce our exposure to certain high volume, low
return markets, resulted in a 3.9% reduction in revenues year-
Our expectation for the coming year is that the Main Plant
on-year.
market will continue to remain competitive but that there will
be good opportunities in many of our Specialist Products and
Operating profits were down 48% from £25.1m to £13.0m.
Tool Hire businesses to improve market share and hire rates.
Capital expenditure was reduced by 60% from £67.0m to
£26.7m and will continue to be linked to our focus on return on
A-Plant now has 73 dedicated Tool Hire locations in the UK
investment.
with a further 65 Main Plant locations also offering Tool Hire as
part of their general plant fleet. Despite this number of
This was a year of consolidation as we addressed a number of
locations putting us in the top ten nationwide, A-Plant is not
internal issues such as the exceptional equipment disposal
perceived as a major player in the Tool Hire market. Instead,
programme. Although overall the year has been difficult with
customers’ perception of A-Plant is of the core Main Plant
the time spent on internal issues acting, in some cases, as a
products such as diggers, dumpers and rollers. Therefore,
distraction to the business, I am pleased to say that the
during the next six months, we will be re-branding our
necessary actions are now completed.
dedicated Tool Hire locations as ‘Tool Hire Shops’, a brand
Prospects
Looking ahead, the new structure of A-Plant, which I
introduced, is now fully operational and gives us the ability to
focus on our three core business areas: Main Plant (general
equipment), Tool Hire and Specialist Products.
Four operating divisions, A-Plant North, South, Midlands and
Ireland, will develop the Main Plant and Tool Hire businesses
geographically. Specialist Products, which was previously part
of the regional structure, includes Rail, Power Generation,
Pumps, Welding, Accommodation, Powered Access, Acrow
(formwork and falsework), Groundcare, Big Air, Trenchless
Technology and Traffic, will be run, for the first time, on a
national basis by senior managers, experts in their field, with
appropriate authority and profit accountability. This will give
us greater flexibility in servicing and meeting customers’ needs
name we have owned (but not used) for many years. This will
help in changing customers’ perceptions and allow us to focus
with a dedicated management team and staff on increasing
our share of this market.
National accounts and large regional accounts continued to
grow and represented 25% of total revenues in 2001/2. We
believe we are one of very few companies in the UK who can
offer the full range and breadth of product to support such
customers’ wish to outsource their equipment needs. We
were pleased to be appointed sole supplier to Transco in April
under an agreement estimated by our customer to be worth
some £4m annually. We will continue to use our market
leadership to develop our major account business as our large
customers themselves increase their businesses through, inter
alia, winning large PFI projects. Accordingly, in the April 2002
reorganisation, we restructured and enlarged our major
accounts sales team to help us better serve this market.
Ashtead Group plc 20.
This does not, however, mean that the local marketplace is being
ignored. Our business has always been built on the foundation of
local business and relationships between our profit centres and
customers. That is why we have a manager at every one of our
locations empowered to make decisions on developing business
in their market. It is also why, after a period of experimentation
last year when we managed the local salesforce on a regional
basis, we reverted in my recent reorganisation to a structure where
the local salesman is part of the profit centre team and reports to
the profit centre manager.
The future progress of A-Plant will result from a focused and
committed management team along with the continued hard work
by all our highly motivated profit centre staff who are intent on
improving turnover, profitability and return on investment.
Sat Dhaiwal
Chief Executive, A-Plant
8 July 2002
Ashtead Group plc 21.
Operational Review - Ashtead Technology Rentals
Markets
Offshore & Inspection
Environmental
Overall the business achieved 11% revenue growth in the year.
We have now had our first full year of results from the
All three offshore and inspection businesses have benefited
environmental instrument rental business we purchased in
from our ability to react to local demands by moving
October 2000. Like for like total revenues were up 3% overall
equipment quickly and efficiently between locations. This
but more importantly like for like rental revenues grew 17%
ability to match availability and demand profiles has led to
reflecting a reduced emphasis on lower margin sales business.
improved utilisation of our assets worldwide.
The four locations in North America that came with the
business have all increased their profitability. Although there
Our Aberdeen operation, which deals with Europe and Africa,
was an overall decline in the US environmental market, our
had a mixed year. The North Sea sector had a very good start
own performance continued to improve as our marketing
to the year with a poorer second half whilst the West African
initiatives and selective asset investments following the
deepwater market was strong and consistent throughout the
acquisition helped us to increase market share.
year. Pricing remained very competitive in our major product
areas as there was strong pressure in the market for reduced
Both our UK and Singapore operations have started to
prices both from our customers and our competition. An
develop their environmental fleets to meet their local market
enhanced marketing effort has enabled us to maintain our
demands.
market share.
Prospects for the coming year
Singapore performed well with the recovery in the Far East
Offshore we expect the UK sector of the North Sea to remain
economies continuing to drive a demand for energy. This
subdued following tax changes announced in the April Budget.
increased demand in the field development market has more
We anticipate a slight improvement in the Norwegian sector
than replaced the subsea cable business lost in the collapse of
and continued strength in West Africa. The Gulf of Mexico will
the telecom market. There has been considerable strength in
remain quiet overall but we will see additional work from South
this offshore market recovery as demand has come from
America, primarily Brazil, and from Eastern Canada. In South
across Australasia. Our inspection business achieved growth
East Asia we expect to see moderate growth from the current
throughout the region.
high base.
Houston, like Aberdeen, had an excellent start to the year
We are forecasting that our inspection business will maintain
followed by a slower second half. As the year progressed,
growth in all geographical areas, the most promising area for
offshore saw a significant decline in field development related
development again being the onshore segment of our
work. The inspection business was generally robust
inspection market.
throughout the year but there was some slackness in the
second half of the year due to a slowdown in offshore activity
as the US economy slowed down.
In Environmental the prospects remain bright in spite of the
weakness in the overall US economy. We expect this year to
Ashtead Group plc 22.
add to the number of locations supplying these instruments.
Overall the outlook for our technology based business looks
promising. We have in place the necessary procedures,
marketing, product range and, above all, good people to continue
to make this business a success.
Rob Phillips
Chief Executive
Ashtead Technology Rentals
8 July 2002
Ashtead Group plc 23.
Directors
7
5
2
4
9
1
6
3
8
1. Henry Staunton, Non-executive Chairman
4. Bruce Dressel, President and Chief Executive
Aged 54, Henry Staunton, BA, FCA, is Finance Director and
Officer, Sunbelt Rentals
Deputy Chairman, Media Ventures of Granada plc. He is also
Aged 38, Bruce Dressel is President and Chief Executive
Chairman of the Nominations Committee and a member of the
Officer of Sunbelt Rentals Inc, the Group’s equipment rental
Audit and Remuneration Committees.
division in the USA. Bruce Dressel has some 20 years
Executive directors
2. George Burnett, Chief Executive
experience in the industry and joined the Group on the
acquisition of the business of McLean Rentals in March 1996.
The re-election of Bruce Dressel, who retires by rotation in
Aged 55, George Burnett, MA, LLB, CA, was Managing
accordance with the Articles of Association, as a director of
Director from May 1984 until being appointed Chief Executive
the Company will be proposed at the Annual General Meeting.
in February 2000. He is a non-executive director of Henderson
Strata Investments plc and Chairman of the Governors of the
5. Sat Dhaiwal, Chief Executive Officer - A-Plant
Surrey Institute of Art and Design, University College.
Aged 33, Sat Dhaiwal was appointed a director of the
3. Ian Robson, Finance Director
Company and Chief Executive Officer of A-Plant on 4 March
2002. Sat Dhaiwal has spent his career to date in the UK hire
Aged 43, Ian Robson, BSc, FCA, was appointed Finance
industry and joined A-Plant in 1993 as a manager of one of its
Director on 26 June 2000 having joined the Group on 22 May
profit centres. He was promoted to trading director in 1995
2000. For the preceding four years he held a series of senior
and Managing Director of A-Plant East, one of A-Plant’s four
financial positions in Reuters Group Plc and before that he
operational regions, in 1998. Having been appointed by the
was a partner of Price Waterhouse (now
PricewaterhouseCoopers).
directors, Sat Dhaiwal retires in accordance with the Articles of
Association and his election will be proposed at the Annual
General Meeting.
Ashtead Group plc 24.
Directors
Non-executive directors
6. Alan Wheatley, Deputy Chairman and senior
8. Chris Cole, Independent non-executive director
independent non-executive director
Aged 55, Chris Cole, C.Eng, FCIBSE, is Chief Executive of
Aged 64, Alan Wheatley, FCA, is currently Chairman of Special
WSP Group plc. He is a member of the Audit and
Utilities Investment Trust plc and a non-executive director of
Remuneration committees. Having been appointed by the
Babcock International Group Plc, ComXo plc and of
directors on 10 January 2002, Chris Cole retires in accordance
IntaMission plc. He is Chairman of the Remuneration
with the Articles of Association and his election will be
Committee and a member of the Audit and Nominations
proposed at the Annual General Meeting.
Committees.
7. Philip Lovegrove, Independent non-executive
interests can be found in the Report of the Remuneration
Details of the Directors’ contracts, emoluments and share
director
Committee on pages 32 to 37.
Aged 64, Philip Lovegrove, LLM, is Chairman of VTR plc and a
non-executive director of Environmental Polymers plc and
Company secretary
Fiske plc. He is Chairman of the Audit Committee and a
9. Robert Clark,
member of the Remuneration and Nominations Committees.
Aged 58, Robert Clark, FCA, ATII, joined the Group in August
The re-election of Philip Lovegrove, who retires by rotation in
1991 as Group Corporate Controller and was appointed
accordance with the Articles of Association, as a director of
Company Secretary in May 1997.
the Company, will be proposed at the Annual General Meeting.
Advisers
Auditors
PricewaterhouseCoopers
1 Embankment Place
London WC2N 6NN
Registrars & Transfer Office
Lloyds TSB Registrars
The Causeway
Worthing
West Sussex BN99 6DA
Financial PR Advisers
Tulchan Communications
St Martin's House
16 St Martin's Le Grand
London EC1A 4ES
Principal Bankers
Lloyds TSB Bank plc
St George's House
6/8 Cheapside
London EC3M 1LL
Bank of America
1 Aile Street
London E1 8DE
Joint Brokers
Schroder Salomon Smith Barney
Citigroup Centre
33 Canada Square
Canary Wharf
London E14 5LB
WestLB Panmure Limited
Woolgate Exchange
25 Basinghall Street
London EC2V 5HA
Bank of America
100 North Tryon Street
Charlotte
North Carolina 28255
Solicitors
Slaughter and May
One Bunhill Row
London
E1Y 8YY
Parker, Poe, Adams & Bernstein LLP
Three First Union Center
401 South Tryon Street
Charlotte
North Carolina 28202
Speechly Bircham
6 St Andrew Street
London EC4A 3LX
Ashtead Group plc 25.
Directors’ Report
The Directors present their report and the audited accounts for the financial year ended 30 April 2002.
Principal activities
The principal activity of the Company is that of an investment holding and management company. The principal activity of the
Group is the rental of equipment to industrial and commercial users.
Trading results & dividends
The Group's consolidated loss before taxation for the year is £15.5m (2000/1 - profit of £11.1m). A review of the Group's
performance is given on pages 2 to 23.
An interim dividend of 0.62p per ordinary share was paid on 6 April 2002. The directors recommend that a final dividend of
2.88p per ordinary share amounting to £9.3m be paid to the holders of the ordinary shares and that the retained loss of £7.6m
be transferred to reserves. If approved, this dividend will be paid on 30 September 2002 to ordinary shareholders on the record
at 6 September 2002.
Share capital
The following shareholders have notified the directors that they hold or are beneficially interested in 3% or more of the
Company's ordinary share capital as set out below:
Schroders Investment Management Limited
AMVESCAP
Henderson Investment Management Limited
Lazard Asset Management Limited
JM Harvey
UBS Asset Management Limited
GB Burnett
Barclays Bank plc
Aegon Asset Management
Capital Group of Companies
Share option schemes
At 30 April 2002, the following shares were subject to option:
Discretionary schemes
Exercisable between 16 September 1995 and 16 September 2002
Exercisable between 26 August 1997 and 26 August 2004
Exercisable between 27 September 1998 and 27 September 2005
Exercisable between 27 February 2000 and 27 February 2007
Exercisable between 27 February 2000 and 27 February 2007
Exercisable between 3 February 2001 and 3 February 2008
Exercisable between 5 February 2001 and 5 February 2008
Exercisable between 5 January 1998 and 5 January 2004 *
Exercisable between 24 February 2002 and 24 February 2009
Exercisable between 26 February 2002 and 26 February 2009
Exercisable between 22 February 2003 and 22 February 2010
Exercisable between 8 March 2003 and 8 March 2010
Exercisable between 8 August 2003 and 8 August 2010
Exercisable between 16 August 2003 and 16 August 2010
Exercisable between 9 February 2004 and 9 February 2011
Exercisable between 26 February 2004 and 26 February 2011
Exercisable between 26 February 2005 and 26 February 2012
Number of shares
524,676
996,500
1,134,694
441,500
1,297,700
305,700
2,463,500
2,248
522,450
1,111,600
1,076,000
363,500
920,500
29,500
3,424,140
524,000
4,626,000
19,764,208
Ashtead Group plc 26.
At 28 June 2002
%
11.5
8.6
6.5
5.4
5.0
4.1
4.1
3.7
3.3
3.0
Option price per share
14.870p
61.440p
72.535p
134.665p
132.250p
191.200p
184.200p
170.370p
177.830p
172.500p
102.000p
101.840p
102.500p
101.670p
125.000p
124.500p
41.500p
Directors’ Report
SAYE scheme
Exercisable between 1 April and 30 September 2002 (5 year contract)
Exercisable between 1 April and 30 September 2003 (5 year contract)
Exercisable between 1 April and 30 September 2002 (3 year contract)
Exercisable between 1 April and 30 September 2004 (5 year contract)
Exercisable between 1 April and 30 September 2003 (3 year contract)
Exercisable between 1 April and 30 September 2005 (5 year contract)
Exercisable between 1 April and 30 September 2004 (3 year contract)
Exercisable between 1 April and 30 September 2006 (5 year contract)
Exercisable between 1 April and 30 September 2005 (3 year contract)
Exercisable between 1 April and 30 September 2007 (5 year contract)
Number of shares
545,136
65,551
75,545
19,700
201,206
143,690
103,791
52,688
2,783,126
1,495,815
5,486,248
Option price per share
98.000p
152.140p
133.600p
133.600p
81.340p
81.340p
94.800p
94.800p
41.600p
41.600p
* These options result from the rolling over of options under the Sheriff Holdings share option schemes into options under the
Company's schemes.
Employees
The total number of employees worldwide of the Group at 30 April 2002 was 6,545.
The Group makes every reasonable effort to give disabled applicants, and existing employees becoming disabled, opportunities
for work, training and career development in keeping with their aptitudes and abilities. The Group is an equal opportunities
employer.
The Group has taken action consistently through the year to maintain and develop arrangements aimed at involving employees
in its affairs. For example, monthly meetings are held at Profit Centres to discuss the previous month's performance. The
Group has a positive approach to health and safety at work and to compliance with the law and the requirements of the
regulatory bodies in both the UK and the USA. A copy of the relevant formal statement of the Group's policy on health and
safety is on display at profit centres in the UK and the USA.
The Group encourages employees to become shareholders through discretionary and SAYE share option schemes. Details of
options outstanding under these schemes are set out above.
Directors and directors' insurance
Details of the current directors of the Company are given on pages 24 and 25. In addition, PD Lewis served as non-executive
Chairman in the year until his retirement on 31 July 2001 and EJ Forshaw served as a director in the year until his resignation
on 4 March 2002.
The Company has maintained insurance throughout the year to cover all directors against liabilities in relation to the Company
and its subsidiary undertakings.
Future developments
The Group seeks to develop by expansion of its activities in equipment rental in the United Kingdom, the United States, the
Republic of Ireland and the environmental and offshore oil and gas industries throughout the world.
Policy on payment of suppliers
Suppliers are paid in accordance with the individual payment terms agreed with each of them. The number of Group creditor
days at 30 April 2002 was 85 days (30 April 2001 - 132 days) which reflects the terms agreed with individual suppliers. There
were no trade creditors in the Company's balance sheet at any time during the past two years.
Ashtead Group plc 27.
Directors’ Report
Political and charitable donations
The Group made a charitable donation during the year of US$100,000 to The American Red Cross National Capital Chapter
following the events of 11 September 2001. Additionally other charitable donations of £8,650 were made in the UK (2000/1 -
donations totalled £1,500). No political donations were made in either year.
Environmental report
The Group, through its equipment purchasing policies, maintenance programmes and environmental monitoring practices,
endeavours to ensure that its trading activities have as little adverse impact on the environment as it is possible to achieve. In
pursuit of this ideal, the Group has developed environmental management processes which are designed to ensure:
compliance with relevant legislation;
removal of potential causes of environmental damage where practicable; and
continuous reduction in environmental impact through monitoring and corrective action.
The Group's continued investment in its rental fleet, along with its maintenance programmes, minimises both pollution to the
atmosphere and accidental contamination. The facilities the Group maintains throughout its profit centre network enable waste
to be disposed of correctly, bulk fuels to be stored safely and fleet cleaning and maintenance to be carried out efficiently.
Group companies have documented procedures at profit centre level for fleet maintenance, removal of waste from customers'
sites back to Company premises for safe disposal as well as contractual arrangements for the disposal of all major waste
products.
The Group's Performance Standards teams measure and monitor environmental performance and control measures at profit
centres as part of their rolling audit programme and report their findings to senior operational management.
Post balance sheet event
On 14 June 2002 the Company and certain of its subsidiaries entered into the accounts receivable securitisation described in
note 31 to the accounts.
Auditors
PricewaterhouseCoopers have indicated their willingness to continue in office and a resolution concerning their re-appointment
and authorising the directors to fix their remuneration will be proposed at the Annual General Meeting.
Annual General Meeting
The Annual General Meeting will be held at 12.30pm on Friday 20 September 2002, at the offices of West LB Panmure Limited,
Woolgate Exchange, 25 Basinghall Street, London EC2V 5HA. For ordinary shareholders, a separate Notice of Annual General
Meeting, which includes an explanation of the proposed resolutions, is enclosed with the Report and Accounts. In addition to
the ordinary business of the meeting, shareholder consent will be sought to renew authorities for the directors to allot ordinary
shares in the Company as set out more fully in the Notice.
By Order of the Board
Robert Clark
Company Secretary
8 July 2002
Ashtead Group plc 28.
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Corporate Governance Report
The Group is committed to high standards of corporate governance. The Board recognises that it is accountable to the
Company's shareholders for corporate governance and this statement describes how the relevant principles have been
practised by the Company.
The Company complied during the year with the principles of corporate governance set out in Section I of the Combined Code
save that the service contracts of George Burnett and Bruce Dressel provide for either notice periods in excess of one year or
pre-determined compensation in excess of one year's salary. Details of these arrangements and the justification for them are
given in the Remuneration Committee Report. New directors appointed since April 2000 have service contracts containing
notice periods of one year or less.
Additionally as described in the Report and Accounts for last year the Company did not comply throughout that year in the
following areas of the Code, all of which were addressed during this year:
the Company's Articles of Association were amended at the Annual General Meeting held on 8 October 2001 to ensure that
every director is now required to retire by rotation and offer himself for re-election at least once in any period of three
consecutive years;
procedures were established in June 2001, for directors, singularly or collectively, to obtain independent professional advice
at the Company's expense; and
the Board resolved in June 2001 that all newly appointed directors would, as needed, receive appropriate training to prepare
them for their role as a director. Additionally the three executive directors appointed in 2000 attended such training in
November 2001 and Mr Dhaiwal has also commenced this training.
The Board and the Executive
The Company's Board currently comprises the non-executive chairman, the chief executive, the finance director, the executive
heads of Sunbelt and A-Plant and three non-executive directors. Short biographies of the directors are given on pages 24 and 25.
All directors are responsible under the law for the proper conduct of the Company's affairs. The directors are also responsible for
ensuring that the strategies proposed by the executive directors are discussed in detail and critically assessed to ensure that
they conform with the long term interests of shareholders and are compatible with the interests of employees, customers and
suppliers. The Board has reserved to itself those matters which reinforce its control of the Company.
To ensure that the directors are suitably briefed to fulfil their roles, regular reports and briefings are provided to the Board by the
executive directors and the company secretary. The Board normally meets at least five times a year and there is contact
between meetings to advance the Company's activities. The directors also have access to the company secretary and a
procedure has been adopted for them to take independent advice as needed at the Company's expense.
Board sub-committees
Audit Committee
Comprising the non-executive directors under the chairmanship of Philip Lovegrove, the Audit Committee meets twice a year to
consider the draft interim and final financial statements and to receive the report of the Auditors. The Committee considers the
effectiveness of the Group's internal controls and its financial and accounting policies and practices and also meets periodically
with the heads of the US and UK Performance Standards (internal audit) teams. It also deals with any matters which may be
brought to the attention of the Committee by the Auditors.
Nominations Committee
With Henry Staunton as chairman, and George Burnett, Alan Wheatley and Phillip Lovegrove as members, the Nominations
Committee is responsible for reviewing the composition of the Board and for recommending to the Board any appropriate
changes in its structure.
Remuneration Committee
Comprising the non-executive directors under the chairmanship of Alan Wheatley, the Remuneration Committee is responsible
for setting the remuneration packages of the executive directors and for establishing the terms and conditions of their
employment.
Ashtead Group plc 29.
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Corporate Governance Report
Finance and Administration Committee
The Board has delegated authority for dealing with routine financial and administrative matters to the Finance and
Administration Committee chaired by George Burnett. The Committee, of which Henry Staunton and Ian Robson are the other
members, meets periodically as necessary to discharge its functions. This Committee has a quorum of any two members but
there is also a list of its business which it can only validly perform in the presence of Henry Staunton (eg final approval of
announcements, other than routine notices of major shareholdings, to the London Stock Exchange).
Financial reporting
The directors are required by UK company law and financial reporting standards to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the Company and of the Group at the end of the financial
year and of the profit and cash flows of the Group for the period.
In preparing the financial statements, applicable accounting standards have been followed, the most appropriate accounting
policies have been used and applied consistently and reasonable and prudent judgements and estimates have been made.
Going concern
The directors also have a responsibility under UK company law and financial reporting standards to prepare the financial
statements on a going concern basis unless the entity is being liquidated or the directors have no realistic alternative but to
liquidate the entity or to cease trading. When preparing the financial statements the directors are also required to assess
whether there are any significant doubts concerning the Group's ability to continue as a going concern.
After making appropriate enquiries the directors have reasonable expectation that the Company and the Group have adequate
resources to continue in operational existence for the foreseeable future and that it is therefore appropriate to adopt the going
concern basis in preparing the financial statements. In forming this view the directors have reviewed the Group's budgets and
cash flow forecasts to 30 April 2003 and outline projections for the subsequent year.
Internal controls
The directors acknowledge their responsibility for the Group's system of internal control and confirm they have reviewed its
effectiveness. In doing so, the Group has taken note of the guidance for directors on internal control, Internal Control:
Guidance for Directors on the Combined Code (the Turnbull Guidance).
The Board confirms that there is a process for identifying, evaluating and managing significant risks faced by the Group. This
process has been in place for the full financial year and is ongoing. It is kept under regular review by the Finance and
Administration Committee and is considered periodically by the Board and accords with the Turnbull Guidance.
The Board considers that the Group's internal control system is appropriately designed to manage, rather than eliminate, the
risk of failure to achieve business objectives. Any such control system, however, can only provide reasonable and not absolute
assurance against material misstatement or loss. The concept of reasonable assurance recognises that the cost of a control
procedure should not exceed the benefits.
The process for keeping risks and the related internal control under review is based initially on work undertaken by the heads of
the US and UK Performance Standards (internal audit) teams. In the year ended 30 April 2001 they undertook a thorough
review of the Group and of the risks it faces in its business and of how these risks are managed. This year, they have reviewed
and updated this work and produced a new report in conjunction with the management teams of each of the Group's
businesses. Their work included consideration of whether there were any matters which had arisen since their first report was
prepared which might indicate omissions or inadequacies in their initial review. They also considered whether, as a result of
changes in either the internal or external environment, new significant risks had arisen.
The executive directors met and reviewed their draft report which was then presented to and discussed by the Group Board at
its April 2002 meeting. Additionally, the executive directors and the Group Board considered business risk and internal control
during the year in relation to major projects, such as the UK disposal programme.
Ashtead Group plc 30.
Corporate Governance Report
Before producing the statement on internal control for the annual report and accounts for the year ended 30 April 2002, the
Board reconsidered the operational effectiveness of the Group's internal control systems on the basis of the reports discussed
above. Each of the most significant risks the Group faces and how well these are controlled and managed were reviewed. The
control system includes written policies and control procedures, clearly drawn lines for accountability and delegation of authority,
and comprehensive reporting and analysis against budgets and latest forecasts.
In a group of the size and complexity and geographical diversity of Ashtead, it should be expected that minor breakdowns in
established control procedures might occur. There are supporting policies and procedures for investigation and management of
control breakdowns at any of the Group's profit centres or elsewhere.
The Audit Committee also meets with PricewaterhouseCoopers twice annually to discuss the results of their work.
In relation to internal financial control, the Group's control and monitoring procedures include:
the maintenance and production of accurate and timely financial management information, including a monthly profit and
loss account for each profit centre;
the control of key financial risks through clearly laid down authority levels and proper segregation of accounting duties at the
Group's accounting support centres;
the preparation of a regular financial report to the Board including profit and loss accounts for the Group and each
subsidiary, balance sheets and cash flow statements;
the preparation of annual budget and periodic update forecasts which are reviewed by the executive directors and then by
the Board;
a programme of periodical rotational rental equipment inventories conducted fortnightly at each profit centre by equipment
type and independently checked on a sample basis;
full inventory counts at all profit centres on at least a six monthly basis with independent scrutiny on a sample basis; and
comprehensive audits of all profit centres carried out on average at least once per year by the Performance Standards
Department. These reports are copied to the Finance Director to whom the heads of the Sunbelt and A-Plant Performance
Standards Departments have direct access in the event of any issues which they may need to discuss independently of the
operational management team.
By order of the Board
Robert Clark
Company Secretary
8 July 2002
Ashtead Group plc 31.
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Remuneration Committee Report
Structure of the Committee
During the year the Committee consisted of the non-executive directors under the Chairmanship of Mr Wheatley. Mr Lewis was
also a member until his retirement on 31 July 2001. Mr Cole became a member of the Committee with effect from 10 January
2002 following his appointment as a director. None of the Committee members has any personal financial interests, other than
as shareholders, in the matters to be decided.
Remuneration policies
In formulating its policies, the Committee has access to professional advice from outside the Company and to publicly available
reports and statistics. Executive remuneration packages are designed to attract, motivate and retain directors of the high
calibre needed to achieve the Group's objectives and to reward them for enhancing value to shareholders. The main elements
of the remuneration package for executive directors and senior management are:
basic annual salary and benefits in kind;
annual performance bonus plan;
share related incentives, including the new Investment Incentive Plan (a long-term co-investment plan) approved by
shareholders on 8 October 2001; and
pension arrangements.
In assessing all aspects of pay and benefits, the Company compares packages offered by similar companies, which are chosen
having regard to:
the size of the company (turnover, profits and number of people employed);
the diversity and complexity of its businesses;
the geographical spread of its businesses; and
their growth, expansion and change profile.
In making the comparisons, the Company takes into consideration the international scope, complexity and speed of change of
the Group's business and, particularly, its now significant operations in the USA. In relation to share option awards, the
Committee's policy is to make regular awards to senior staff in order that their personal interests are aligned with those of
shareholders. The value of the shares underlying the options awarded is assessed by reference to a number of factors
including the employee's salary, seniority and length of service.
The Committee implements its remuneration policies by the design of reward packages for executive directors comprising the
appropriate mix of salary, performance related cash incentive bonuses and share options. Mr Burnett, with the approval of the
Board, holds two non-executive appointments outside the Group and is allowed to retain the fees arising therefrom. None of
the other executive directors has any outside appointments.
The remuneration of the non-executive directors is determined by the Board. None of the non-executive directors has a service
contract with the Company and their appointment is therefore terminable by the Board at any time.
Executive directors' service agreements
Mr Burnett's service agreement, first entered into on 27 November 1986 and amended periodically until consolidation into a
new agreement dated 21 May 1997, provides for termination by either party by the giving of two years' notice. However, Mr
Burnett is entitled at any time after reaching age 59 to give at least six months' notice to retire from age 60. Otherwise the
contract remains in place until he reaches age 65. The unexpired period of the contract is a little over 9 years.
Mr Dressel entered into a new service agreement with Sunbelt Rentals Inc on 15 January 2001 under which he is employed as
its President and Chief Executive Officer for an automatically extended rolling period of two years until the contract is
terminated. Mr Dressel may not terminate the contract in the first two years but can do so at any point thereafter by giving 180
days' notice to Sunbelt. Early termination provisions apply should there be a change of control of Ashtead Group, defined as at
least 50% of the voting rights becoming held by a single person. Sunbelt, however, can only terminate Mr Dressel's
employment by giving two years' notice except in the case of misconduct. On termination, except on change of control, Mr
Dressel is prohibited from working in the rental industry in the USA for two years. The Remuneration Committee considered
that it was appropriate to secure the services of Mr Dressel for an initial minimum period of two and a half years in light of the
importance of his contribution to Sunbelt's successful development within the Group and accordingly decided to depart from
the recommendations of the Combined Code by entering into a contract with more than one year's notice.
Ashtead Group plc 32.
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(cid:2)
Remuneration Committee Report
The service agreements between the Company and Mr Robson (dated 4 August 2000) and Mr Dhaiwal (dated 5 July 2002) are
terminable by either party giving the other twelve months' notice.
Mr Lewis retired as non-executive chairman of Ashtead Group plc and of Sunbelt Rentals Inc on 31 July 2001 whereupon his
contract with the Company terminated. On retirement Mr Lewis did not receive any payments beyond his remuneration accrued
up to that date.
Mr Forshaw resigned as a director of the Company and of Ashtead Plant Hire Company Limited, of which he was Chief
Executive Officer, on 4 March 2002. His employment within the Group terminated on 1 May 2002.
The service agreements of the executive directors all contain suitable non-compete provisions appropriate to their roles in the
Group.
Directors' emoluments
The emoluments of the directors, which are included in staff costs in note 3 to the financial statements, were as follows:
Name
Year ended 30 April 2002
George Burnett
Ian Robson
Bruce Dressel
Sat Dhaiwal
Ted Forshaw
Henry Staunton
Alan Wheatley
Philip Lovegrove
Chris Cole
Peter Lewis
Year ended 30 April 2001
Peter Lewis
George Burnett
Ian Robson
Bruce Dressel
Ted Forshaw
Alan Anderson
Henry Staunton
Alan Wheatley
Philip Lovegrove
Fees
£'000
Salary
£'000
Performance Compensation
for loss of
office
£'000
related
bonus
£'000
Other
benefits
in kind
£'000
Total
emoluments
excluding
pension
benefits
£'000
-
-
-
-
-
104
55
30
8
-
197
-
-
-
-
-
-
25
55
30
110
420
220
261
24
185
-
-
-
-
38
1,148
199
216
152
233
180
23
-
-
-
1,003
-
80
189
-
1
-
-
-
-
-
270
541
541
161
245
46
-
-
-
-
1,534
-
-
-
-
347
-
-
-
-
-
347
-
-
-
-
-
-
-
-
-
-
19
14
10
2
8
-
-
-
-
-
53
15
23
29
1
9
3
-
-
-
80
439
314
460
26
541
104
55
30
8
38
2,015
755
780
342
479
235
26
25
55
30
2,727
The 2001/02 emoluments of:
(1) Sat Dhaiwal are those for the period from his appointment on 4 March 2002 until 30 April 2002.
(2) Ted Forshaw are those for the period until his resignation on 4 March 2002; and
(3) Peter Lewis are those for the period until his retirement on 31 July 2001;
The 2000/01 emoluments of:
(1) Ian Robson are those for the period from his appointment on 26 June 2000; and
(2) Alan Anderson are those for the period to his retirement on 26 June 2000. In addition, an ex-gratia payment of £30,000 was
made to Mr Anderson at the time of his retirement.
Ashtead Group plc 33.
Remuneration Committee Report
Directors' emoluments (continued)
Effective 1 May 2001, the Company adopted new annual performance related bonus plans for the executive directors under
which payments are related directly to performance in the year. The maximum entitlement under annual bonus plans was also
capped at two-thirds of salary for all executive directors other than Mr Dressel whose annual bonus was capped at 100% of
salary. The annual bonus plan of Mr Dressel and Messrs Forshaw and Dhaiwal depended exclusively on the performance of
Sunbelt and A-Plant respectively, Mr Robson's depended partly on the Group's financial performance and partly on non-
financial targets relating to the management of the Group's financial position and its relationships with its lenders and Mr
Burnett's depended on the Group's financial performance. Actual payments reflect the extent to which these objectives were
attained.
In accordance with the provisions of his contract, which provided for one year's notice, on or shortly after the termination of his
employment with the Group on 1 May 2002, Mr Forshaw received compensation of £250,000, his existing company car valued
at £6,200, and outplacement counselling and other benefits paid for by the Company to a value of £41,000. His remuneration
for the period from the date of his resignation as a director on 4 March 2002 until his employment terminated on 1 May 2002
was £35,000. He was also allowed, in accordance with the rules of the relevant option plans, to retain his existing outstanding
share options as described further below. In addition the Company agreed to procure that the Trustees of the Ashtead Group
plc Retirement Benefits Plan credited Mr Forshaw with the benefits accruing from an additional year's membership of the
pension plan at a cost to the Company of £49,500.
Directors' pension benefits
Age
at 30 April
Years
Accrued
pensionable
service
at 30 April
Years
Contributions
paid by
the director
£000
Accrued
annual
pension
£000
Increase
in annual
pension
at 30 April
£000
Year ended 30 April 2002
George Burnett
Ian Robson
Sat Dhaiwal
Year ended 30 April 2001
George Burnett
Ian Robson
Ted Forshaw
55
43
33
54
42
50
18
2
8
17
1
8
-
11
1
-
8
7
348
14
11
330
6
19
18
8
3
62
6
8
Under the terms of his service contract, Mr Burnett is entitled to retire at age 60 with a pension of two-thirds of remuneration on
retirement. For this purpose remuneration is defined as the highest average annual remuneration received in the best three
consecutive years in the ten years prior to retirement with remuneration meaning basic salary effective from 1 May 2001 under a
change to Mr Burnett's employment contract agreed on 10 January 2002. Prior to that date, remuneration is defined as the
gross value of emoluments received in the year.
Mr Burnett's pension entitlement is funded through contributions to the managed funds of independent fund managers operated
through the Ashtead Group plc Pension Scheme. Mr Burnett's pension in payment increases in line with price inflation, up to
7% a year. A spouse's pension of two-thirds of Mr Burnett's retirement benefit is payable in the event of his death either before
or after retirement. The Company receives regular advice from external advisers on the level of contributions required to meet
the anticipated final salary liability. The current level of funding is as most recently recommended by the advisers.
Under the terms of his contract, Mr Robson is entitled to retire at age 60 on a pension equal to one-thirtieth of his final salary for
each year of pensionable service. He is a member of the Company's Retirement Benefits Plan, which is a defined benefits
scheme, in respect of his earnings up to the Inland Revenue limit. The pension in respect of his earnings above that limit is
provided by an unapproved unfunded retirement benefits arrangement agreed between him and the Company. Mr Robson's
contract also contains early retirement provisions allowing him to retire and draw a pension based on actual years of service,
but without deduction for early payment which take effect once he has completed ten years service with the Company (or at
anytime after age 50 if there is a change of control). Mr Robson pays contributions equal to 5% of his salary, all of which was
paid to the Retirements Benefits Plan in the current year.
Ashtead Group plc 34.
Remuneration Committee Report
Mr Dhaiwal's and Mr Forshaw's pension benefits are also provided through the Ashtead Group plc Retirement Benefits Plan.
Their pension rights accrue at the rate of one-sixtieth of basic salary for each year of pensionable service and normal retirement
is at age 65.
Except where otherwise stated above, the Retirement Benefits Plan provides:
in the event of death, between leaving service and retirement while retaining membership of the Plan, a spouse's pension
equal to 50% of the member's deferred pension calculated at the date of death plus a return of his contributions;
in the event of death in retirement, a spouse's pension equal to 50% of the member's pension at the date of death;
an option to retire at any time after age 50 with the Company's consent. Early retirement benefits are reduced by an
amount agreed between the Actuary and the Trustees as reflecting the cost to the Plan of the early retirement;
pension increases in line with the increase in retail price inflation up to 5% a year; and
transfer values do not include discretionary benefits.
Mr Dressel is a member of the US defined contribution plan to which the Group contributed £2,024 in the year (£3,600 in
2000/01).
Directors' interests in shares
The Directors of the Company are shown below together with their interests in the share capital of the Company:
28 June 2002
Number of ordinary
shares of 10p each
30 April 2002
Number of ordinary
shares of 10p each
30 April 2001*
Number of ordinary
shares of 10p each
Beneficial Non-beneficial
Beneficial Non-beneficial
Beneficial
Non-beneficial
GB Burnett
SI Robson
BJ Dressel
SS Dhaiwal
PA Lovegrove
HE Staunton
AE Wheatley
C Cole
* or date of appointment where later
12,284,399
105,821
317,157
13,000
382,500
245,000
282,000
20,000
Investment Incentive Plan
1,056,192
-
-
-
-
-
-
-
12,284,399
105,821
317,157
13,000
382,500
245,000
282,000
20,000
1,056,192
-
-
-
-
-
-
-
12,000,000
11,000
200,000
13,000
182,500
145,000
132,000
-
1,056,192
-
-
-
-
-
-
-
This new long-term incentive plan under which executive directors who elect to invest all or a portion of their annual cash
bonuses in shares of the Company are eligible for matching awards in the form of shares which only vest subject to demanding
performance conditions was approved by shareholders of the 2001 Annual General Meeting on 8 October 2001.
Initial matching awards were made on 23 January 2002 as follows:
George Burnett
Ian Robson
Bruce Dressel
Ted Forshaw
Maximum number
of shares
which may vest
1,422,006
474,107
650,878
175,541
These matching awards, made in respect of investment shares acquired with all or part of the directors' bonuses for the year
ended 30 April 2001, will only vest, in whole or part, based on the annual growth in the Company's earnings per share in the
three year period ended 30 April 2004 over that of the year ended 30 April 2001 and on the Company's Total Shareholder
Return ("TSR") performance relative to a comparator group comprising all of the FTSE250 mid-cap stocks other than investment
trusts over the three year period from 8 October 2001 (when the Company's share price at close was 72p) to 8 October 2004.
Ashtead Group plc 35.
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)
Remuneration Committee Report
Investment Incentive Plan (continued)
Vesting of the matching awards is based on the following required performance grid:
Real EPS
growth
performance
upper range
RPI + 7% p.a.
target range
RPI + 5% p.a.
minimum range
RPI + 3% p.a.
TSR performance against peer group
Below Median TSR
Median
63rd
Percentile
75th
Percentile
1.0 x match
0.75 x match
0.5 x match
2.0 x
match
1.5 x
match
1.0 x
match
2.5 x
match
2.0 x
match
1.5 x
match
3.0 x
match
2.5 x
match
2.0 x
match
No matching award vests
Vesting operates on a scaled basis for performance between the target levels shown in the grid above. Performance is
measured at the end of the performance period when the awards either vest in full or part or lapse completely. For performance
measurement purposes earnings per share is based on the profit before exceptional items measured under consistently applied
accounting policies.
In connection with the operation of the Plan, the Company has established an Employee Share Ownership Trust which, on 21
and 22 January 2002, purchased 2,722,575 shares at an average cost of 57p per share, being the number of shares potentially
equal, at the maximum performance level, to the matching awards granted. Ownership of these shares was conditionally
transferred to each director on 15 April 2002 subject to forfeiture to the extent that the required performance conditions are not
attained. The executive directors have also waived their entitlement to any dividend on these shares until the conclusion of the
performance period.
The Company will charge against profit each year an amount equal to one-third of the expected cost of the proportion of the
matching award expected to vest at the end of the three year performance period.
Directors' interests in share options
Options at
1 May 2001
or on
appointment
Granted Exercised/
lapsed
the year during year
during
Market
price at
date of
Options at
exercise 30 April 2002
Discretionary schemes
GB Burnett
521,362
491,400
487,494
200,000
350,000
166,700
300,000
90,000
29,500
195,500
230,000
-
-
-
-
-
-
-
300,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
521,362
491,400
487,494
200,000
350,000
166,700
300,000
90,000
29,500
195,500
230,000
300,000
SI Robson
Ashtead Group plc 36.
Earliest
normal
exercise
date
Sept 1995
Aug 1997
Sept 1998
Feb 2000
Feb 2001
Feb 2002
Aug 2003
Feb 2004
Aug 2003
Aug 2003
Feb 2004
Feb 2005
Expiry
Sept 2002
Aug 2004
Sept 2005
Feb 2007
Feb 2008
Feb 2009
Aug 2010
Feb 2011
Aug 2010
Aug 2010
Feb 2011
Feb 2012
Exercise
price
14.870p
61.440p
72.535p
132.250p
184.200p
172.500p
102.500p
125.000p
101.670p
102.500p
125.000p
41.500p
Remuneration Committee Report
Options at
1 May 2001
or on
appointment
Granted Exercised/
lapsed
the year during year
during
Market
price at
date of
Options at
exercise 30 April 2002
Discretionary schemes
SS Dhaiwal
JB Dressel
40,000
32,500
50,000
35,000
-
60,000
200,000
66,700
140,000
230,000
-
-
-
-
-
100,000
-
-
-
300,000
SAYE scheme
GB Burnett
S I Robson
SS Dhaiwal
17,602
17,800 Contract cancelled
-
-
3,520
-
39,783
-
22,836
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Earliest
normal
exercise
date
Expiry
Feb 2000
Feb 2001
Feb 2002
Feb 2004
Feb 2005
Feb 2000
Feb 2001
Feb 2002
Aug 2003
Feb 2004
Feb 2005
Feb 2007
Feb 2008
Feb 2009
Feb 2011
Feb 2012
Feb 2007
Feb 2008
Feb 2009
Aug 2010
Feb 2011
Feb 2012
Exercise
price
132.250p
184.200p
172.500p
125.000p
41.500p
132.250p
184.200p
172.500p
102.500p
125.000p
41.500p
40,000
32,500
50,000
35,000
100,000
60,000
200,000
66,700
140,000
230,000
300,000
17,602
-
39,783
3,520
22,836
98.000p
94.800p
41.600p
98.000p
41.600p
April 2002
Sept 2002
April 2006
Sept 2006
Sept 2007
April 2007
April 2002 Sept 2002
April 2005 Sept 2005
The market price of the Company's shares at the end of the financial year was 42.0p; the highest and lowest share prices during
the financial year were 130.5p and 30.0p respectively.
Mr Dressel also holds an award over 250,000 units under the Company's Cash Incentive Scheme which was granted on 22
February 2000 at a price of 102p per unit. This award is subject to the same performance conditions as apply to the Company's
unapproved share option scheme and is exercisable on 22 February 2003 if the performance criteria have been satisfied when
the difference between the mid market price of Ashtead Group shares on that day and the grant price multiplied by the number
of units held will be paid to him by way of a cash award. On his appointment on 4 March 2002, Mr Dhaiwal held 50,000 units
under the Cash Incentive Scheme which were granted to him on 22 February 2000. In his case, he can exercise his options in
the period from 22 February 2003 to 21 February 2010.
Mr Forshaw was allowed to retain the options held at the date of his resignation as a director of the Company for exercise
according to the rules of the relevant scheme. His holdings under the approved scheme, 109,210 shares granted in August
1994 at 61.44p per share and 152,334 shares granted in September 1995 at 72.525p per share, will lapse on 1 November 2002,
if not exercised on or before that date. His holdings of options under the unapproved scheme, 60,000 shares granted in
February 1997 at 132.25p per share, 125,000 shares granted in February 1998 at 184.20p per share and 230,000 shares granted
in February 2001 at 125.00p per share, will lapse on 1 May 2003 if not exercised on or before that date. The matching shares
awarded to Mr Forshaw under the Investment Incentive Plan reverted to the ESOT on 1 May 2002. Mr Forshaw's holdings of
250,000 units under the Cash Incentive Scheme granted in February 2000 lapsed on 1 May 2002. Finally, Mr Forshaw has until
the end of September 2002 to exercise his options over 17,602 shares at 98.00p per share granted under the Company's SAYE
scheme.
Following his retirement from full time office, Mr Lewis' holdings of options granted in September 1992, September 1994 and
August 1995 would have lapsed on 31 July 2001 in accordance with the rules of the approved share option scheme unless
previously exercised. Accordingly, on 18 July 2001 he exercised all these options crystallising a profit before taxes of £804,716.
Mr Lewis' holdings of options granted in February 1997 (200,000 shares at 132.250p), February 1998 (350,000 shares at 184.2p)
and February 1999 (166,700 shares at 172.5p), which he was permitted to retain on his retirement on 31 July 2001, will lapse
unless exercised by 31 July 2002 in accordance with the rules of the unapproved share option scheme.
Alan Wheatley
Chairman of the Remuneration Committee
8 July 2002
Ashtead Group plc 37.
Statement of Directors Responsibilities
The directors are required by the Companies Act 1985 to prepare financial statements for each financial year which give a true
and fair view of the state of affairs of the Company and the Group as at the end of the financial year and of the profit or loss for
the financial year.
In preparing the financial statements the Directors are required to:
select suitable accounting policies and then apply them consistently supported by judgements and estimates that are
reasonable and prudent;
state whether applicable accounting standards have been followed, subject to any material departures disclosed and
explained in the financial statements; and
prepare the financial statements on a going concern basis unless this is inappropriate.
The directors are also responsible for keeping proper accounting records which disclose with reasonable accuracy at any time
the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act
1985. The directors also have responsibility for taking reasonable steps to safeguard the assets of the Group and prevent and
detect fraud and other irregularities.
The maintenance and integrity of the Ashtead Group plc website is the responsibility of the directors; the work carried out by
the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any
changes that may have occurred to the financial statements since they were initially presented on the website.
Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.
By order of the Board
Robert Clark
Company Secretary
8 July 2002
Ashtead Group plc 38.
(cid:2)
(cid:2)
(cid:2)
Independent Auditors’ Report to the Members of
Ashtead Group plc
We have audited the financial statements which comprise the consolidated profit and loss account, the consolidated balance
sheet, the Company balance sheet, the consolidated cash flow statement, the consolidated statement of total recognised gains
and losses and the related notes and the additional disclosures within the remuneration committee report relating to the
remuneration of the directors specified for our review by the London Stock Exchange.
Respective responsibilities of directors and auditors
The directors' responsibilities for preparing the annual report and the financial statements in accordance with applicable United
Kingdom law and accounting standards are set out in the statement of directors' responsibilities.
Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements, United
Kingdom Auditing Standards issued by the Auditing Practices Board and the Listing Rules of the Financial Services Authority.
We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in
accordance with the Companies Act 1985. We also report to you if, in our opinion, the directors' report is not consistent with the
financial statements, if the company has not kept proper accounting records, if we have not received all the information and
explanations we require for our audit, or if information specified by law or the Listing Rules regarding directors' remuneration and
transactions is not disclosed.
We read the other information contained in the annual report and consider the implications for our report if we become aware of
any apparent misstatements or material inconsistencies with the financial statements. The other information comprises only the
directors' report, the chairman's report, the chief executive's review, the financial review, the Sunbelt Rentals, A-Plant and
Ashtead Technology operational reviews and the corporate governance report.
We review whether the corporate governance report reflects the company's compliance with the seven provisions of the
Combined Code specified for our review by the Listing Rules, and we report if it does not. We are not required to consider
whether the board's statements on internal control cover all risks and controls, or to form an opinion on the effectiveness of the
group's corporate governance procedures or its risk and control procedures.
Basis of audit opinion
We conducted our audit in accordance with Auditing Standards issued by the Auditing Practices Board. An audit includes
examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an
assessment of the significant estimates and judgements made by the directors in the preparation of the financial statements, and
of whether the accounting policies are appropriate to the company's circumstances, consistently applied and adequately
disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order
to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material
misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
Opinion
In our opinion the financial statements give a true and fair view of the state of affairs of the company and the group as at 30 April
2002 and of the profit and cash flows of the group for the year then ended and have been properly prepared in accordance with
the Companies Act 1985.
PricewaterhouseCoopers
Chartered Accountants and Registered Auditors
London
8 July 2002
Ashtead Group plc 39.
Consolidated Profit & Loss Account
for the year ended 30 April
2002
2001
Before
goodwill
Goodwill
amortisation amortisation
and
exceptional exceptional
items
£m
items
£m
and
Before
goodwill
Goodwill
amortisation amortisation
and
exceptional
items
£m
(restated)
and
exceptional
items
£m
(restated)
Total
£m
583.7
(462.2)
121.5
(40.2)
-
-
-
583.7
(462.2)
-
-
(8.8)
121.5
(40.2)
(8.8)
552.0
(430.8)
121.2
(32.6)
-
-
-
-
(12.3)
(8.1)
Total
£m
(restated)
552.0
(430.8)
121.2
(44.9)
(8.1)
81.3
(8.8)
72.5
88.6
(20.4)
68.2
-
(32.6)
(32.6)
-
-
-
Notes
2
2,3
23
5, 23
(52.4)
(3.0)
(55.4)
(47.4)
(9.7)
(57.1)
Turnover
Cost of sales
Gross profit
Administrative expenses
Goodwill amortisation
Operating profit
Exceptional loss on disposal
of fixed assets
Net interest payable and
similar charges
28.9
0.3
18.9
19.2
48.1
(Loss)/profit on ordinary
activities before taxation
Taxation on profit on ordinary
activities: - current tax
- deferred tax
6
6, 19
Profit for the financial year
Equity dividends
21
8
Retained (loss)/profit
transferred to reserves
Basic earnings per share
Diluted earnings per share
9
9
(44.4)
(15.5)
41.2
(30.1)
11.1
1.2
(10.1)
(8.9)
-
-
-
32.3
(30.1)
-
-
-
(44.4)
0.3
18.9
19.2
3.7
(11.3)
(7.6)
1.1p
1.1p
1.2
(10.1)
(8.9)
2.2
(11.3)
(9.1)
0.7p
0.7p
Consolidated Statement of Total Recognised Gains & Losses For the Year Ended 30 April
Profit for the financial year
Foreign currency translation differences
Total recognised gains and losses relating to the year
Prior period adjustments relating to deferred taxation
Total gains and losses recognised since the
last annual report
Notes
19
2001
£m
(restated)
2.2
(0.2)
2.0
2002
£m
3.7
(0.7)
3.0
(48.4)
(45.4)
All acquisitions made this year were immediately integrated into the Group's ongoing operations. No segregated operating profit
information is therefore available.
There is no material difference between the results shown above and those which would have been shown on a historical cost basis.
Comparative figures have been restated as described in note 19.
Ashtead Group plc 40.
Consolidated Balance Sheet at 30 April
Notes
2002
£m
2001
£m
(restated)
10
11
11
12
13
14
26 (c)
15
16
17
19
19
20
21
21
21
160.8
164.3
678.1
72.8
750.9
1.6
913.3
12.9
110.7
0.5
124.1
(23.5)
(121.7)
(145.2)
725.6
76.9
802.5
-
966.8
15.3
125.7
1.1
142.1
(4.8)
(222.7)
(227.5)
(21.1)
(85.4)
892.2
881.4
(504.4)
(18.2)
(129.7)
(652.3)
(41.1)
(4.3)
(45.4)
(480.7)
-
(127.9)
(608.6)
(66.0)
(4.7)
(70.7)
194.5
202.1
32.5
100.7
0.5
60.8
194.5
32.4
100.1
0.5
69.1
202.1
Fixed assets
Intangible assets
- goodwill
Tangible fixed assets:
- rental equipment
- other fixed assets
Investments
- own shares held by ESOT
Current assets
Stock
Debtors
Cash at bank and in hand
Creditors - amounts falling due within one year
Bank loans, overdrafts and finance lease obligations
Trade and other creditors
Net current liabilities
Total assets less current liabilities
Creditors - amounts falling due after more than one year
Bank and other loans
Finance lease obligations
5.25% unsecured convertible loan note, due 2008
Provision for liabilities and charges
Deferred taxation
Other provisions
Total net assets
Capital and reserves
Called up share capital
Share premium account
Revaluation reserve
Profit and loss account
Total equity shareholders' funds
Comparative figures have been restated as described in notes 15, 17 and 19.
These financial statements were approved by the Board on 8 July 2002.
GB Burnett
SI Robson
Ashtead Group plc 41.
Company Balance Sheet at 30 April
Fixed assets
Investments - own shares held by ESOT
Investments in group companies
Current assets
Debtors
Creditors - amounts falling due within one year
Trade and other creditors
Net current assets
Total assets less current liabilities
Creditors - amounts falling due after more than one year
5.25% unsecured convertible loan note, due 2008
Other loan notes
Total net assets
Capital and reserves
Called up share capital
Share premium account
Revaluation reserve
Profit and loss account
Total equity shareholders' funds
These financial statements were approved by the Board on 8 July 2002.
GB Burnett
SI Robson
Notes
12
12
14
16
17
17
20
21
21
21
2002
£m
1.6
351.7
353.3
2001
£m
-
348.5
348.5
132.5
133.5
(15.2)
(11.4)
117.3
470.6
(129.7)
(0.3)
(130.0)
122.1
470.6
(127.9)
(0.3)
(128.2)
340.6
342.4
32.5
100.7
198.6
8.8
340.6
32.4
100.1
198.6
11.3
342.4
Ashtead Group plc 42.
Consolidated Cash Flow Statement
for the year ended 30 April
Notes
26(a)
Net cash inflow from operating activities
Cash inflow before integration costs
Exceptional BET USA integration costs
Net cash inflow from operating activities
Returns on investments and servicing of finance
Interest received
Interest paid
Exceptional costs re bank facility
Interest element of finance lease payments
Net cash outflow from returns on investments and
servicing of finance
Taxation (outflow)/inflow
Capital expenditure and financial investment
Purchase of tangible fixed assets
Sale of tangible fixed assets
Purchase of own shares by employee share ownership trust
Net cash outflow from capital expenditure and
financial investment
-
(43.5)
(1.3)
(5.6)
(203.3)
39.2
(1.6)
Acquisitions & disposals outflow
26(d)
Equity dividends paid
Net cash outflow before management of liquid
resources and financing
Inflow from management of liquid resources
Financing
Issue of ordinary share capital
Drawdown of loans
Redemption of loans
Capital element of finance lease payments
Net cash inflow from financing
(Decrease)/increase in cash
0.7
89.3
(56.8)
(10.7)
26(e)
26(e)
26(b)
£m
2002
£m
£m
2001
£m
173.0
(10.3)
162.7
(46.4)
1.7
(164.3)
(214.1)
(10.4)
(270.8)
15.6
296.8
41.6
202.0
-
202.0
(50.4)
(0.7)
(165.7)
(3.3)
(11.3)
(29.4)
-
22.5
(6.9)
0.6
(37.3)
(9.7)
-
(202.6)
38.3
-
0.5
466.6
(170.3)
-
All acquisitions made this year were immediately integrated in to the Group's ongoing operations. No segregated cash flow
information is therefore available.
Ashtead Group plc 43.
Notes to the Financial Statements
1 Accounting policies
Accounting convention and basis of consolidation
The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain
freehold properties and in accordance with applicable accounting standards. The financial statements include the results of the
Company and all its subsidiaries. A summary of the more important accounting policies, which have been applied consistently
with the exception of the impact of the adoption of FRS 19: Deferred tax as described in note 19, is given in the following
paragraphs. Comparative figures have been restated to reflect the change in accounting policy.
Foreign currency translation and derivative financial instruments
Exchange differences arising from the retranslation of the opening net investment of overseas subsidiaries and the difference
between the inclusion of their profits at average rates of exchange in the Group profit and loss account and the closing rate are
dealt with as movements on reserves. Other exchange differences are dealt with in the profit and loss account. Assets and
liabilities in foreign currencies including long term liabilities are translated at rates of exchange ruling at the balance sheet date.
This treatment is required by statement of standard accounting practice number 20 (SSAP 20) in order to give a true and fair
view of the Group's results. Compliance with SSAP 20 overrides Schedule 4, paragraph 12 of the Companies Act 1985 which
states that only profits realised at the balance sheet date should be included in the profit and loss account.
The group uses derivative financial instruments to manage its interest rate exposures. These are principally swap agreements
used to manage the balance between fixed and floating rate finance on long term debt. The group accounts for such
derivatives, which are only used for hedging purposes, using the accrual method under which amounts payable or receivable in
respect of derivatives are recognised rateably in net interest payable over the period of the contract. They are not revalued to
fair value or shown on the group balance sheet at the balance sheet date.
Turnover
Turnover represents the total amount receivable for the provision of goods and services to customers net of returns and value
added tax. Rental income is recognised on a straight line basis over the period of the contract.
Fixed assets
Fixed assets are stated at historical cost or valuation (net of any discounts received) less accumulated depreciation and
provisions for impairment where appropriate. Leasehold properties are amortised over the life of each lease. Other fixed assets,
including those held under finance leases, are depreciated on a straight line basis applied to the opening cost to write down
each asset to its residual value over its useful economic life. The rates in use are as follows:
Freehold property
Rental equipment
Motor vehicles
Office and workshop equipment
Per annum
4%
5% to 33%
16% to 25%
20%
Fixed assets that are not capable of individual identification (non-itemised equipment) are depreciated so as to write them down
to their residual value over their useful economic lives of 5 to 20 years. Some of the group's freehold and long leasehold
properties were revalued on the basis of their open market value at 30 April 1989. On adoption of FRS 15 the group followed
the transitional provisions to retain the book value of land and buildings that were revalued in 1989 but not to adopt a policy of
revaluation in future.
Repair and maintenance
Repair and maintenance of rental equipment is charged against revenue costs incurred in the period.
Ashtead Group plc 44.
Notes to the Financial Statements
Acquisitions and goodwill
Acquisitions during the financial year have been accounted for on an acquisition basis and the results of companies acquired
are therefore included from the effective date of acquisition. The net tangible assets of companies acquired are incorporated in
the consolidated accounts at their fair value to the Group. In accordance with the requirements of FRS 7, post acquisition
integration expenses are charged to the profit and loss account and, where material, disclosed as an exceptional item.
Goodwill, being the difference between the cost and fair value of the Group's share of net assets acquired, arising on all
acquisitions since 1 May 1999 has been capitalised in the year in which it arises and is amortised on a straight line basis over
its useful economic life. Goodwill arising before 1 May 1999 has been deducted from the accumulated profit and loss account
reserve but will be written back and taken to the profit and loss account in the event that it either becomes impaired or if the
business to which it relates is disposed of.
Deferred taxation
Deferred tax is provided using the incremental liability approach and is measured on a non-discounted basis at the tax rates
that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws substantively enacted
at the balance sheet date. Deferred tax is recognised in respect of timing differences that originated but not reversed by the
balance sheet date except that (a) deferred tax in respect of the unremitted earnings of overseas subsidiaries is only recognised
where there is a binding intent to distribute past earnings at the balance sheet date; and (b) deferred tax assets are only
recognised to the extent that they are regarded as recoverable.
Leases
Assets held under finance leases are capitalised with a related credit to finance lease obligations in respect of the capital asset
of the lease payments. Such assets are depreciated in accordance with the Company's depreciation policy at the same rate as
applied to equivalent owned assets. Interest payable on finance leases is computed at the rate inherent in the lease.
Operating lease rentals are charged against profits on a straight line basis over the period of the lease.
Stocks
Stocks are valued at the lower of cost and net realisable value.
Pensions
The Group operates defined benefit and defined contribution pension plans for the benefit of its employees under arrangements
established by Group companies. In respect of the defined benefit plans, actuarial valuations are made regularly and the
contributions payable are adjusted as appropriate. Pension costs are accounted for on the basis of charging the expected cost
of providing pensions over the period during which the Group benefits from the employees' services. The effect of variations
from regular cost are spread over the expected average remaining service lives of the members of the plan. Contributions to
defined contribution plans are expensed as incurred.
Investments
Investments in subsidiary undertakings are stated at cost less any necessary provision for impairment in the parent company
balance sheet. Where an investment in a subsidiary undertaking is transferred to another subsidiary undertaking, any uplift in
the value at which it is transferred over its carrying value is treated as a revaluation of the investment prior to the transfer and is
credited to the revaluation reserve.
Own shares held by the Employee Share Ownership Trust
Shares owned beneficially by the Employee Share Ownership Trust are capitalised as fixed asset investments at cost less any
required provision for permanent impairment. Where these shares are subject to commitments to release them to employees
(subject to the attainment of performance target) in connection with the Group's long term incentive plans, then provision is
made by way of a charge against profits to write off the estimated cost of the shares expected to be released at the end of the
performance period over the long term incentive period which is normally three years.
Ashtead Group plc 45.
Notes to the Financial Statements
2 Segmental analysis
The Company operates one class of business: rental of equipment. The segmental analysis by geographic unit is given below:
North America
United Kingdom
Rest of World
Exceptional costs
Goodwill amortisation
Central items*
* net borrowings and deferred taxation
Turnover
2001
£m
2002
£m
Operating profit
2001
£m
(restated)
2002
£m
2002
£m
Net assets
2001
£m
(restated)
389.1
192.3
2.3
583.7
350.2
199.7
2.1
552.0
-
-
-
-
66.0
14.6
0.7
81.3
61.2
26.8
0.6
88.6
-
(12.3)
(8.8)
(8.1)
659.7
249.1
2.1
910.9
-
-
591.5
286.9
2.0
880.4
-
-
-
583.7
-
552.0
-
72.5
-
68.2
(716.4)
194.5
(678.3)
202.1
There is no material difference between turnover by origin as shown above and turnover by destination. Acquisitions in the year
added £7.7m (2000/1 - £175.2m) to revenue in the North American segment. The exceptional loss on disposal of fixed assets in
the year of £32.6m (note 23) arises in the UK.
3 Operating profit
Operating profit is stated after charging / (crediting) :
Staff costs:
Salaries
Social security costs
Other pension costs
Depreciation (see note 11)
Goodwill amortisation
Profits on disposal of fixed assets
Net currency gain
Hire of plant and machinery
Other operating leases
2002
£m
169.6
21.6
2.8
120.9
8.8
(1.5)
(1.0)
6.6
20.4
2001
£m
(restated)
149.7
17.4
3.1
114.5
8.1
(6.8)
(1.2)
15.9
13.1
Audit fees payable to PricewaterhouseCoopers were £409,000 (2001 - £259,500). This includes £25,000 (2001 - £20,000) in
respect of the parent company. Fees paid to PricewaterhouseCoopers for non-audit services amounted to £244,500 (2001 -
£999,400) in the UK and £70,304 in the US (2001 - £140,600).
Profits on disposal of fixed assets (excluding the exceptional UK disposal programme) have been included within operating
profit as they resulted from routine sales of rental equipment and are considered in effect to be no more than required
adjustments to depreciation previously charged.
4 Directors' emoluments
Directors' remuneration and interests are given in the Report of the Remuneration Committee on pages 32 to 37.
Ashtead Group plc 46.
Notes to the Financial Statements
5 Net interest payable and similar charges
Bank interest payable
Accrued interest amortisation on convertible loan
Interest payable on finance leases
Total interest payable
Bank interest receivable
Exceptional costs re bank facility
2002
£m
39.2
7.6
5.6
52.4
-
3.0
55.4
2001
£m
41.4
6.6
-
48.0
(0.6)
9.7
57.1
Exceptional costs in relation to the bank facility in 2002 comprise variation fees payable in connection with (i) the adjustments
made to bank covenants in July 2001 consequent upon adoption of new accounting policies under FRS18 in the 2001 accounts
and (ii) the adjustments made to bank covenants in April 2002 to provide greater future financial flexibility in light of the impact
of the downturn in the US economy.
6 Taxation
UK Corporation tax at 30% (2000/1 - 30%)
- current year charge
- credit in respect of prior year
Double taxation relief
Overseas taxation
- current year charge
- credit in respect of prior year
Total current tax credit
Deferred taxation
- current year charge
- prior year credit
2002
£m
2001
£m
(restated)
-
(0.9)
(0.9)
-
(0.9)
0.6
-
0.6
(0.3)
2.5
(21.4)
(18.9)
(19.2)
0.1
(1.1)
(1.0)
(0.1)
(1.1)
0.1
(0.2)
(0.1)
(1.2)
10.1
-
10.1
8.9
All of the 2001/2 and 2000/1 deferred tax relates to the origination and reversal of timing differences. Details of the restatement
of the prior year taxation charge on implementation of FRS 19 - Deferred taxation and of the reconciliation between the tax
credit expected on the basis of the loss before taxation evaluated at the UK standard rate of corporation tax of 30% and the
actual tax credit are given in note 19.
7 Profit and loss account
Ashtead Group plc has not presented its own profit and loss account as permitted by section 230 (3) of the Companies Act
1985. The amount of the profit for the financial year dealt with in the accounts of Ashtead Group plc is £8.8m (2001 - £11.5m).
Ashtead Group plc 47.
Notes to the Financial Statements
8 Equity dividends
Interim dividend paid at 0.62p net per share (2001 - 0.62p)
Proposed final dividend of 2.88p net per share (2001 - 2.88p)
9 Earnings per share
2002
£m
2.0
9.3
11.3
2001
£m
2.0
9.3
11.3
Earnings per share for the year ended 30 April 2002 have been calculated based on the profit for the financial year and on
324,090,666 ordinary shares, being the weighted average number of ordinary shares in issue during the year which excludes the
2,722,575 shares held by the ESOT since 22 January 2002 in respect of which dividends have been waived (2001 - 323,334,079
ordinary shares). Diluted earnings per share for the year are computed using the profit for the financial year and the diluted
number of shares calculated as follows:
Profit for
the financial
year
£m
Weighted
average no.
of shares
millions
2002
Per
share
amount
p
Profit for
the financial
year
£m
(restated)
Weighted
average no.
of shares
millions
2001
Per
share
amount
p
(restated)
As used in the calculation
of basic earnings per share excluding
the shares held by the ESOT
Outstanding share options
As used in the calculation of
diluted earnings per share
10 Intangible assets - goodwill
3.7
-
3.7
324.1
1.6
325.7
1.1
-
1.1
2.2
-
2.2
323.3
3.0
326.3
0.7
-
0.7
Group
At 1 May 2002 as previously reported
Prior year adjustment re BET USA deferred tax
At 1 May 2001 as restated
Arising in respect of acquisitions in the year
Adjustment in relation to BET USA acquired
1 June 2000
Amortisation during the year
Cost
£m
Amortisation
£m
Net
book value
£m
158.4
14.4
172.8
2.8
2.5
-
(7.7)
(0.8)
(8.5)
-
-
(8.8)
150.7
13.6
164.3
2.8
2.5
(8.8)
At 30 April 2002
178.1
(17.3)
160.8
Goodwill written off directly to reserves as at 30 April 2002 was £58.1m (2001 - £58.1m).
An amortisation period of 20 years has been selected for the goodwill arising on acquisitions in the year and in previous years
because this is considered to best represent the useful life of the goodwill arising on these acquisitions.
Ashtead Group plc 48.
Notes to the Financial Statements
11 Tangible fixed assets
Cost or valuation
At 1 May 2001
Exchange difference
Acquisitions
Additions
Disposals
At 30 April 2002
Depreciation
At 1 May 2001
Exchange difference
Charge for the period
Disposals
At 30 April 2002
Net book value
At 30 April 2002
Rental equipment
Held under
Freehold Leasehold
property
property
£m
£m
Owned
£m
Office &
finance workshop
leases equipment
£m
£m
Motor
vehicles
£m
Total
£m
41.0
(0.3)
-
1.1
(1.1)
40.7
(4.5)
-
(0.5)
0.2
(4.8)
23.4
(0.2)
-
6.8
(1.4)
28.6
(4.3)
0.1
(1.6)
0.6
(5.2)
962.8
(11.7)
(0.9)
98.0
(110.1)
938.1
(237.2)
4.3
(105.5)
51.3
(287.1)
-
0.9
32.9
-
-
33.8
-
-
(6.7)
-
(6.7)
16.7
(0.1)
0.1
6.1
(4.7)
18.1
(8.3)
0.1
(3.6)
4.1
(7.7)
28.9
(0.3)
-
1.8
(23.1)
7.3
1,072.8
(11.7)
32.1
113.8
(140.4)
1,066.6
(16.0)
0.2
(3.0)
14.6
(4.2)
(270.3)
4.7
(120.9)
70.8
(315.7)
35.9
23.4
651.0
27.1
10.4
3.1
750.9
At 30 April 2001
36.5
19.1
725.6
-
8.4
12.9
802.5
The net book amount of leasehold property comprises:
Long leasehold
Short leasehold
The closing net book value of property stated at cost
or valuation may be analysed as follows:
Stated at cost
Stated at valuation performed at 30 April 1989
The net book value at which assets stated at valuation would have
been shown if they had not been revalued is as follows:
12 Investments
Group
2002
£m
1.1
22.3
23.4
2001
£m
2.1
17.0
19.1
Freehold
£m
Leasehold
£m
34.4
1.5
35.9
22.4
1.0
23.4
1.2
0.8
Fixed asset investments of the group of £1.6m comprise own shares held by the Employee Share Ownership Trust ("ESOT")
which is established in Jersey and holds an interest in 2,722,575 shares in the Company acquired at a cost of 57p per share.
These shares, which as described in the Remuneration Committee report on pages 32 to 37, relate to matching awards to
directors under the Company's Investment Incentive Plan and had a market value at 30 April 2002 of £1.1m.
Ashtead Group plc 49.
Notes to the Financial Statements
12 Investments (continued)
Company
At 1 May 2001
Additions in the year
At 30 April 2002
The Company's principal subsidiaries are:
Name
Ashtead Plant Hire Company Limited
Ashtead Plant Hire Company (Ireland) Limited
Ashtead Technology Limited
Ashtead Technology (South East Asia) pte Limited
Ashtead Technology Inc.
Sunbelt Rentals Inc.
Shares
in group
companies
£m
Loans
to group
companies
£m
224.1
-
124.4
3.2
224.1
127.6
Employee
share
ownership
trust
£m
-
1.6
1.6
Total
£m
348.5
4.8
353.3
Country
of
incorporation
Principal country
in which subsidiary
undertaking operates
England
England
Scotland
Singapore
USA
USA
United Kingdom
Republic of Ireland
United Kingdom
Singapore
USA
USA
The issued share capital (all of which comprises ordinary shares) of subsidiaries is 100% owned by the Company or by
subsidiary undertakings and all subsidiaries are consolidated. The principal activity of each subsidiary undertaking listed above
is equipment rental. All of the above subsidiaries are held by Ashtead Group plc except for Sunbelt Rentals Inc. and Ashtead
Technology Inc. which are owned indirectly through other subsidiary undertakings.
13 Stock
Group
Raw materials, consumables and spares
Goods for resale
14 Debtors
Trade debtors
Amounts due from group undertakings
Prepayments and accrued income
Ashtead Group plc 50.
2002
£m
11.1
1.8
12.9
2001
£m
12.9
2.4
15.3
The
Group
2002
£m
96.6
-
14.1
110.7
The
Group
2001
£m
107.4
-
18.3
125.7
The
Company
2002
£m
The
Company
2001
£m
-
132.3
0.2
132.5
-
133.0
0.5
133.5
Notes to the Financial Statements
15 Bank loans, overdrafts and finance lease obligations
Secured bank overdrafts
Short term portion of secured bank loans
Finance leases due in less than one year
The
Group
2002
£m
8.5
2.6
12.4
23.5
The
Group
2001
£m
(restated)
2.2
2.6
-
4.8
The
Company
2002
£m
The
Company
2001
£m
-
-
-
-
-
-
-
-
Comparative figures have been restated to correct a misclassification of the 1% term loan amortisation per annum which was
previously ignored in the ageing analysis with all the term loan having been shown as repayable in more than five years.
16 Trade and other creditors
Trade creditors
Bills payable
Taxation
Other taxes and social security
Proposed dividend
Accruals and deferred income
The
Group
2002
£m
59.5
11.6
0.9
5.7
9.3
34.7
121.7
The
Group
2001
£m
69.8
90.7
1.9
9.3
9.3
41.7
222.7
The
Company
2002
£m
The
Company
2001
£m
-
-
-
-
9.3
5.9
15.2
-
-
-
-
9.3
2.1
11.4
Trade and other creditors include amounts relating to the purchase of fixed assets (including outstanding bills of exchange) of
£60.7m (2001: £150.2m). Accruals and deferred income include accrued deferred consideration of £0.9m (2001: £nil).
17 Creditors - amounts falling due in more than one year
Loans are payable as follows:
Between two and five years:
- Secured bank debt
- Finance lease obligations
Over five years:
- Secured bank debt
- Loan notes
- 5.25% Unsecured convertible loan note due 2008
The
Group
2002
£m
262.7
18.2
241.4
0.3
129.7
652.3
The
Group
2001
£m
(restated)
232.3
-
248.1
0.3
127.9
608.6
The
Company
2002
£m
The
Company
2001
£m
-
-
-
0.3
129.7
130.0
-
-
-
0.3
127.9
128.2
Interest is payable on these loans currently at rates between 3.9% and 7.1%. Loans payable in between two and five years
relate principally to revolving advances within the US$825m committed secured senior credit facility. These revolving advances
were repayable in May 2001 but have been presented as long term because the revolving advance facility is committed until 31
May 2005. The secured bank debt over five years relates to the medium term bank loan also provided under the senior credit
Ashtead Group plc 51.
Notes to the Financial Statements
17 Creditors - amounts falling due in more than one year (continued)
facility which is repayable on 31 May 2007 except in respect of an amount equal to 1% of the original term facility of £2.6m
($3.75m) which is repayable annually on 1 June each year. Secured bank debt is secured by way of fixed and floating charges
over substantially all of the Group's assets. Comparative figures have been restated to correct a misclassification of the 1%
term loan amortisation per annum which was previously ignored in the ageing analysis with all the term loan having been shown
as repayable in more than five years.
18 Financial instruments
A discussion of financial instruments used by the Group and its approach to managing foreign exchange risk are included in the
financial review on pages 16 and 17. Short term debtors and creditors have been excluded from all the following disclosures
(except the currency profile of monetary assets).
a) The currency and interest rate profile of the Group's financial assets is:
Sterling
US dollar
At 30 April 2002
Sterling
Irish punt (Euro)
US dollar
Singapore dollar
At 30 April 2001
Total
£m
0.1
0.4
0.5
0.3
0.3
0.3
0.2
1.1
Floating
Financial assets
on which no
rate deposits interest is received
£m
£m
-
-
-
-
0.3
-
-
0.3
0.1
0.4
0.5
0.3
-
0.3
0.2
0.8
Floating rate financial assets are deposited for variable periods at prevailing money market rates.
b) The currency and interest rate profile of the Group's financial liabilities is:
Floating rate
borrowings
£m
Weighted
Fixed rate average interest
rate at 30 April
%
borrowings
£m
Weighted
average
time for which
rate is fixed
Years
48.8
279.4
15.4
343.6
75.9
225.3
9.3
310.5
130.0
202.2
-
332.2
128.2
174.7
-
302.9
5.6
5.7
6.4
5.7
5.6
6.8
-
6.3
6.0
1.4
-
2.6
7.2
2.3
-
4.4
Total
£m
178.8
481.6
15.4
675.8
204.1
400.0
9.3
613.4
Sterling
US dollar
Euro
At 30 April 2002
Sterling
US dollar
Euro
At 30 April 2001
The Group's sterling fixed rate borrowings at 30 April 2002 comprised the £134m nominal value unsecured convertible loan note
due 2008 (see note 20) on which interest is fixed at 5.25% per annum and £0.3m of fixed rate loan notes issued by the
Company. The fixed rate US dollar borrowings relate to US$250m (£171.6m) of the borrowings under the group's secured loan
facility on which interest rates have been fixed by means of two interest rate swaps executed in August 2000 with LloydsTSB
Bank plc (US $125m) and Bank of America (US$125m) and to finance lease obligations which are at fixed rate. Interest payable
on floating rate borrowings is linked to LIBOR rates for the relevant currency.
Ashtead Group plc 52.
Notes to the Financial Statements
18 Financial instruments (continued)
c) Currency profile of monetary assets
During the year the Company has used financial instruments for the purpose of managing funding, interest rate and currency
risk. Such derivative financial instruments are only used to manage or hedge underlying exposures and not to create
exposures. At 30 April 2002 the only currency exposures in the group's operations in currencies other than their own functional
currency related to payables of £0.2m in the Republic of Ireland, all of which is payable in pounds sterling. The equivalent
comparatives at 30 April 2001 were payables of £25.9m in the US, £16.6m of which was payable in pounds sterling and £9.3m
of which was payable in Euros, and payables of £11.4m in the Republic of Ireland, all of which was payable in pounds sterling.
d) Maturity of financial liabilities
The maturity profile of the Group's financial liabilities included in note 15 and 17 was:
In one year or less
In more than two years but not more than five years
In more than five years
2002
£m
23.5
280.9
371.4
675.8
2001
£m
(restated)
4.8
232.3
376.3
613.4
e) Borrowing facilities
Undrawn committed facilities at 30 April 2002 in respect of which all conditions precedent had been met totalled £56.9m and
relate to the undrawn balance of the revolving loan commitment under the Group's senior secured bank loan facility which
expires in more than two years but less than five years. At the same date undrawn, uncancelled overdraft facilities totalled
£9.9m.
f) Fair value of financial assets and liabilities
The table below provides a comparison, by category of the carrying amounts and the fair values of the Group's financial assets
and liabilities at 30 April 2002. Fair value is the amount at which a financial instrument could be exchanged in an arm's length
transaction between informed and willing parties and includes accrued interest. Where available, market values have been used
to determine fair values. Where market values are not available, fair values have been calculated by discounting expected cash
flows at prevailing interest and exchange rates.
Summary of methods and assumptions:
Bank loans and overdraft, loan notes, finance lease obligations and cash: - fair value approximates to the carrying value
because of the short maturity of these items or because they bear interest at floating rates which are reset to market rates
at intervals of less than one year.
5.25% convertible loan note: - fair value at 30 April 2002 is calculated by reference to an independent opinion provided by
Schroder Salomon Smith Barney
Interest rate swap agreements: - fair value is determined by reference to market quotations obtained with reference to
interest rates ruling at 30 April 2002
Primary financial instruments held or
issued to finance the Group's operations:
Short term borrowings and overdrafts
Finance lease obligations
Other secured bank loans
(all of which bear interest at floating rates)
Other loan notes
5.25% unsecured convertible loan note due 2008
Cash at bank
Derivative financial instruments held to
manage interest rate profile:
Interest rate swaps (net loss)
Book value
£m
At 30 April 2002
Fair value
£m
Book value
£m
(restated)
At 30 April 2001
Fair value
£m
(restated)
11.1
30.6
504.1
0.3
129.7
(0.5)
675.3
11.1
30.6
504.1
0.3
100.2
(0.5)
645.8
4.8
-
480.4
0.3
127.9
(1.1)
612.3
4.8
-
480.4
0.3
131.1
(1.1)
615.5
-
10.1
-
8.0
Ashtead Group plc 53.
(cid:2)
(cid:2)
(cid:2)
Notes to the Financial Statements
18 Financial instruments (continued)
In line with the Group's accounting policy of accounting for derivatives used to manage the balance between fixed and floating
rate interest rates on long term debt rateably in earnings over the period of the contracts, £7.4m of the total unrecognised loss
on the interest rate swaps of £10.1m at 30 April 2002 will be recognised in the year ending 30 April 2003.
19 Provisions for liabilities and charges
Deferred taxation
Liability recognised in the accounts:
- Short term timing differences
- Tax effect of losses in subsidiary company
- Accelerated capital allowances
Unrecognised deferred tax asset relating to:
- Accelerated capital allowances
- Tax losses in subsidiary company
The movement in the year in the liability provided is:
At 1 May 2001 as previously reported under SSAP 15
Prior year adjustment to reserves
Restatement of fair market value of acquired BET USA deferred taxation
At 1 May 2001 as restated under FRS 19
Exchange differences
Credited to profit and loss account
Adjustments to goodwill relating to acquisition of BET USA (note 22)
At 30 April 2002
2002
£m
(1.0)
(54.7)
96.8
41.1
9.8
0.8
10.6
2001
£m
(3.7)
(26.2)
95.9
66.0
-
-
-
£m
4.0
47.6
14.4
66.0
(1.1)
(18.9)
(4.9)
41.1
The Company has adopted FRS 19 - Deferred taxation this year which requires full provision to be made for deferred taxation as
opposed to the partial provision required by the previous accounting standard, SSAP 15. Comparative figures for the previous
year have been restated accordingly by way of a prior year adjustment to reserves. No deferred tax has been provided in
respect of the surplus arising on revaluation of the Group's properties because all of the properties are employed in the Group's
business, and it is not the Group's intention to dispose of any of them. In any event, the likelihood of a material tax liability
arising on disposal is remote due to the availability of rollover relief. Additionally no deferred tax is provided on the unremitted
earnings of overseas subsidiaries because it is not intended to remit these in the foreseeable future.
The reconciliation between the tax credit for the year and that expected
on the basis of the UK standard corporation tax rate of 30% is as follows:
Expected tax credit based on the loss before taxation of £15.5m for the year at
the standard UK corporation tax rate of 30%
Prior year tax items included in the actual tax credit (£0.9m credit re current tax
and £21.4m credit re deferred tax)
Tax benefits deriving from the structure of the BET USA acquisition
Increase in unrecognised deferred tax assets in the year
Goodwill amortisation included in the loss before tax not allowable for tax
Impact of overseas profits taxed at rates above the UK standard rate
Other permanent differences
Actual tax credit for the year
£m
4.7
22.3
6.7
(10.6)
(2.6)
(2.5)
1.2
19.2
Ashtead Group plc 54.
Notes to the Financial Statements
19 Provisions for liabilities and charges (continued)
Other provisions
At 1 May 2001
Exchange differences
Utilised
Charged in the year
At 30 April 2002
Self insurance
£m
Other
£m
2.9
-
(9.3)
9.9
3.5
1.8
-
(1.7)
0.7
0.8
Total
£m
4.7
-
(11.0)
10.6
4.3
Self insurance provisions relate to the estimated liability in respect of costs to be incurred under the Group's self insurance
programmes for events occurring on or prior to the year end. The provision is determined, with advice from external insurance
brokers, based on claims notified to date plus an allowance for claims incurred but not yet reported. The majority of the amount
provided is expected to be utilised within one year.
Other provisions include individually insignificant items expected to be utilised within one year.
20 Called up share capital and 5.25% unsecured convertible loan note due 2008
Ordinary shares of 10p each
2002
Number
2001
Number
Authorised
450,000,000
450,000,000
Allotted, called up and fully paid
325,131,792
323,611,327
2002
£m
45.0
32.5
2001
£m
45.0
32.4
During the year to 30 April 2002, 1,520,465 ordinary shares were issued for cash to employees exercising options granted over
the Company's share capital.
Also on 1 June 2000, in connection with the acquisition of BET USA, the Company issued the 5.25% £134m nominal value
unsecured convertible loan note due 2008. This loan note is convertible, at the holder's option, into 89,333,333 ordinary shares
at any time after 1 June 2001 and if not converted is redeemable at par on 1 June 2008. The convertible loan note bore no
interest in its first year of issue. No transfer of the loan note is permitted in its first year of issue and thereafter it may only be
transferred with the consent of the Company which will be granted if the Company is satisfied that the transferee (and any
connected persons) would not, in consequence of the transfer, hold ten per cent or more of the issued share capital of the
Company after conversion. Certain orderly marketing restrictions also apply to ordinary shares issued through conversion.
Ashtead Group plc 55.
Notes to the Financial Statements
21 Movements in shareholders' funds
Share
Share
capital
£m
premium Revaluation
reserve
account
£m
£m
Profit
and loss
account
£m
Group
Profit for the financial year
Equity dividends
Other recognised gains and
losses relating to the year
Share capital subscribed
Net additions/(reductions) to
shareholders' funds
At 1 May 2001 as
previously reported
Prior year adjustment
At 1 May 2001 as restated
-
-
-
-
0.1
0.1
32.4
-
32.4
-
-
-
-
0.6
0.6
100.1
-
100.1
Closing shareholders' funds
32.5
100.7
Company
Profit for the financial year
Equity dividends
Transfer of Group undertaking
to subsidiary
Share capital subscribed
Net additions/(reductions) to
shareholders' funds
-
-
-
-
0.1
0.1
-
-
-
-
0.6
0.6
-
-
-
-
-
-
0.5
-
0.5
0.5
-
-
-
-
-
-
At 1 May 2001
32.4
100.1
198.6
Closing shareholders' funds
32.5
100.7
198.6
Total
£m
3.7
(11.3)
(7.6)
(0.7)
0.7
(7.6)
250.5
(48.4)
202.1
2001
£m
(restated)
2.2
(11.3)
(9.1)
(0.2)
0.5
(8.8)
236.8
(25.9)
210.9
3.7
(11.3)
(7.6)
(0.7)
-
(8.3)
117.5
(48.4)
69.1
60.8
194.5
202.1
8.8
(11.3)
(2.5)
-
-
(2.5)
11.3
8.8
8.8
(11.3)
(2.5)
-
0.7
(1.8)
11.5
(11.3)
0.2
(0.1)
0.5
0.6
342.4
341.8
340.6
342.4
The prior year adjustment of £48.4m relates to the adoption of FRS 19 - Deferred taxation and comprises the £47.6m increase
in deferred tax arising at 1 May 2001 on implementation of FRS 19 together with the additional goodwill amortisation of £0.8m
for the period to 30 April 2001 consequent on remeasuring, under FRS 19, the fair market value of the deferred tax liability of
BET USA at acquisition on 1 June 2000.
Ashtead Group plc 56.
Notes to the Financial Statements
22 Acquisitions
i) Current year acquisitions
(a) on 29 June 2001, the business and certain assets of two East Coast locations of United Scaffolding were acquired and
(b) on 1 August 2001, the business and certain assets of SuperRents which traded from three locations in the Seattle,
Washington area were acquired.
Assets acquired at provisional fair market value:
- Fixed assets
- Debtors
Consideration (including costs):
Cash paid
Accrual deferred consideration
Goodwill arising
Total
£m
4.1
1.1
5.2
7.1
0.9
2.8
No fair value adjustments have been made to the value of assets acquired in relation to these acquisitions at this time but fair
values remain provisional pending agreement of the related consideration. These acquisitions have been accounted for from
their respective acquisition dates stated above.
ii) Adjustments to prior year fair values
On 1 June 2000 the Group acquired BET USA. The acquisition was accounted for by the acquisition method of accounting.
The fair values used in the 2001 accounts were provisional. In the year ended 30 April 2002 post acquisition amendments, as
explained below and in accordance with FRS7 'Fair values in acquisition accounting', have been made to these provisional fair
values. The differences have been taken as an adjustment to goodwill on acquisition. Provisional and amended fair values for
net assets acquired were as follows:
Fixed assets
Stocks
Debtors
Cash
Creditors
Deferred taxation
Purchase consideration
Goodwill
Provisional
fair value to
the Group
£m
173.0
4.6
32.4
2.0
(29.0)
-
183.0
326.2
143.2
Completion
& hindsight
Change of
accounting
Final fair
period value to the
Group
£m
policy adjustments
£m
£m
-
-
-
-
-
(14.4)
(14.4)
-
14.4
28.0
-
-
-
(40.1)
4.9
(7.2)
(4.7)
2.5
201.0
4.6
32.4
2.0
(69.1)
(9.5)
161.4
321.5
160.1
The change of accounting policy adjustment relates to FRS19 - Deferred taxation which was adopted during the year.
The principal hindsight period adjustment to fair values relates to the reclassification of certain leases over rental equipment as
finance leases which were previously treated as operating leases by the acquired company, increasing fixed assets by £32.9m,
increasing creditors by £40.3m and generating additional goodwill of £7.4m. Other adjustments are in respect of
reassessments of asset and liability valuations completed in the year which have reduced fixed assets and creditors by £4.9m
and £0.2m respectively less related deferred taxation of £1.8m and the inclusion of a deferred tax asset relating principally to
acquired tax losses of £3.1m.
Ashtead Group plc 57.
Notes to the Financial Statements
22 Acquisitions (continued)
The final purchase price was also agreed in the year under the price adjustment mechanism in the original acquisition
agreement reducing the purchase consideration and goodwill by £4.7m. This reduction was effected through £3.8m received
as a cash repayment from Rentokil and the agreement by Rentokil to assume responsibility for settling a pre-acquisition tax
liability of BET USA totalling £0.9m.
The adjustment to redesignate assets held under certain leases as finance leased assets has resulted in an increase in
depreciation charge and interest expense of the Group but with a reduction in hire of plant and machinery costs. The impact
on the prior year profit and loss account, if these leases had been treated as finance leases in that year, would have been as
follows:
Turnover
Cost of sales
Gross profit
Administrative expenses
Operating profit
Net interest payable
Profit before tax
£m
-
4.7
4.7
(0.4)
4.3
(2.9)
1.4
These adjustments have been reflected in the current year profit and loss account in addition to current year depreciation and
interest charges.
23 Exceptional costs
Loss on disposal of UK assets
BET USA integration costs
Bank facility costs included in interest payable (note 5)
2002
£m
32.6
-
3.0
35.6
2001
£m
-
12.3
9.7
22.0
The exceptional loss on disposal of UK assets is net of proceeds received of £4.9m and also includes incremental transport,
storage and disposal costs of £1.1m. A fuller description of these items is given in the financial review on pages 8 to 17.
24 Operating leases
Minimum annual commitments under existing operating leases may be analysed by date of expiry of the lease as follows:
Land and buildings:
Expiring in one year
Expiring between two and five years
Expiring in more than five years
Other:
Expiring in one year
Expiring between two and five years
Expiring in more than five years
Total
Ashtead Group plc 58.
2002
£m
0.8
4.3
9.4
14.5
1.6
10.4
1.4
13.4
27.9
2001
£m
1.1
5.5
7.3
13.9
4.4
5.4
0.6
10.4
24.3
Notes to the Financial Statements
25 Pensions
The Group operates pension plans for the benefit of qualifying employees. The Group's principal pension plan for its UK
employees, which is a funded defined benefit plan with trustee administered assets held separately from those of the Group,
was subject to an actuarial valuation as at 30 April 2001 by Aon Limited. This valuation used the projected unit credit method
and was carried out on a market-related basis, using a conservative set of actuarial assumptions for funding purposes and a
"best estimate" set for accounting purposes (as required by SSAP 24).
The principal actuarial assumptions used for funding and for accounting purposes were the same except for the pre-retirement
investment return where 6.9% per annum and 7.25% per annum were used respectively for past service and future service for
funding purposes against 7.9% per annum in both cases for accounting purposes and the assumed annual increase in salaries
which was 4.5% for funding purposes and 4% for accounting purposes. The other main assumptions for both funding and
accounting purposes were the post-retirement investment return for current pensioners of 5.1% and for non-current pensioners
of 5.25% and the annual inflation rate of 2.5%.
The market value of the plan assets was £18.3m at the valuation date of 30 April 2001. On an on-going basis, assets at market
value were sufficient to cover 84% of the benefits that had accrued to members on the funding basis and 94% on the SSAP 24
accounting basis. On the advice of the actuary, employer's contributions were paid to this plan during the year ended 30 April
2002 at the rate of 5.0% of members' pensionable salaries at 1 May 2001, as adjusted for leavers during the year, increasing to
11% of pensionable service from November 2001. For accounting purposes, the actuarial deficit in the main UK plan is being
spread over the ten year average remaining expected service life of the employees in the scheme.
The table below shows the employer's cost calculated in accordance with the provisions of SSAP 24 for the main UK plan and
for the other plans:
Principal UK scheme:
Regular cost
Variation from regular cost
Other plans
Accrual for future contributions included in creditors
2002
£m
1.1
0.1
1.5
2.7
0.1
2001
£m
0.8
(0.2)
2.4
3.0
0.1
Other plans include the defined contribution 401K plan operated by Sunbelt Rentals for the benefit of its employees and the
Ashtead Group plc pension scheme described more fully in the Remuneration Committee report on pages 32 to 37.
Additional pension disclosures under FRS17
Each of the Company's defined benefit pension commitments were valued at 30 April 2002 under the provisions of FRS 17 by
independent qualified actuaries using the projected unit valuation method. The major financial assumptions applied by the
actuary were: a discount rate of 6.0%; a rate of increase in pensions in payment of 2.5% in respect of pension accrued after
April 1997; an inflation rate of 2.75%; and a rate of increase in salaries of 4.25%. The classes of asset in the plans and their
expected rates of return were: equities 6.9%; fixed interest bonds and gilts 5.5%; property 6.9% and cash 4.0%.
Under these assumptions and the methods prescribed in FRS 17, the Group's total commitment at 30 April 2002 in respect of
its defined benefit pension commitments is:
Equities
Bonds
Property
Cash
Total market value of assets
Present value of schemes' liabilities as determined by the actuaries using the
method and assumptions prescribed by FRS17 as outlined above
Net deficit on the basis prescribed by FRS17
£m
17.3
3.1
2.0
1.4
23.8
30.9
7.1
Ashtead Group plc 59.
Notes to the Financial Statements
26 Notes to the cash flow statement
a) Cash flow from operating activities
Operating profit
Exceptional BET USA integration costs
Amortisation of goodwill
Depreciation of tangible fixed assets
Gain on sale of tangible fixed assets
Decrease/(increase) in stocks
Decrease/(increase) in trade debtors
(Decrease) in trade creditors
Exchange differences
2002
£m
72.5
-
8.8
120.9
(1.5)
2.4
15.3
(15.4)
(1.0)
2001
£m
68.2
12.3
8.1
114.5
(6.8)
(0.7)
(12.1)
(9.3)
(1.2)
Net cash inflow from operating activities before BET integration costs
202.0
173.0
b) Reconciliation to net debt
Decrease/(increase) in cash in the period
Increase in bank loans
Cash inflow from decrease in short term investments
Change in net debt from cash flows
Translation difference
Movement in net debt in the period
Net debt at 1 May
Net debt at 30 April
Non cash movement
- 5.25% unsecured convertible loan note, due 2008
- obligation due on finance leases
Net debt at 30 April
c) Analysis of movement in net debt
2002
£m
6.9
32.5
-
39.4
(8.8)
30.6
612.3
642.9
1.8
30.6
675.3
2001
£m
(41.6)
296.3
15.6
270.3
22.8
293.1
191.3
484.4
127.9
-
612.3
1 May
2001
£m
(restated)
(1.1)
2.2
1.1
608.6
2.6
612.3
Cash
flow
£m
Non-cash
movements
£m
Exchange
movement
£m
30 April
2002
£m
0.6
6.3
6.9
32.5
-
39.4
-
-
-
20.0
12.4
32.4
-
-
-
(8.8)
-
(8.8)
(0.5)
8.5
8.0
652.3
15.0
675.3
Cash at bank and in hand
Overdrafts
Debt due after 1 year
Debt due within 1 year
Total net debt
Non-cash movements relate to the accrued interest on the 5.25% unsecured convertible loan note, due 2008 and to acquired
finance lease obligations (see note 22).
Ashtead Group plc 60.
Notes to the Financial Statements
26 Notes to the cash flow statement (continued)
d) Acquisitions
Cash consideration on current year acquisitions
Cash consideration refunded on prior year acquisition
Less: cash acquired with subsidiary undertakings
Deferred consideration paid on prior year acquisitions
2002
£m
7.1
(3.8)
-
-
3.3
2001
£m
211.3
-
(2.0)
4.8
214.1
Because the acquired businesses were fully integrated immediately into the Group's operations it is not practicable to analyse
net cash flows between the acquired entities and the Group's other operations.
e) Drawdown/redemption of loans
Drawdown of loans
Term loan
Revolver loans
Redemption of loans
Bank loans
US$ private placement notes
Other loan notes
f) Exceptional items
2002
£m
-
89.3
89.3
(56.8)
-
-
(56.8)
2001
£m
251.2
215.4
466.6
(79.6)
(90.4)
(0.3)
(170.3)
32.5
296.3
Cash flows relating to exceptional items comprise £4.9m of disposal proceeds less disposal costs of £1.1m relating to the UK
equipment disposal programme. In addition £1.3m was paid in relation to the exceptional bank facility costs and the balance of
this exceptional item was paid in May 2002.
27 Contingent liabilities
The Group is subject to periodic legal claims in the ordinary course of its business. However, the claims outstanding at 30 April
2002 are not expected to have a significant impact on the Group's financial position.
The Company has guaranteed bank and other borrowing facilities of subsidiary undertakings under the Group's secured credit
facility. At 30 April 2002 the amount borrowed under these facilities was £515.2m (30 April 2001 - £485.2m).
The Company has also guaranteed annual operating lease commitments of subsidiary undertakings where the minimum lease
commitment at 30 April 2002 totalled £79.0m (2001 - £53.2m) in respect of land and buildings and £28.3m (2001 - £26.2m) in
respect of other operating lease rentals of which £3.4m and £8.6m respectively is payable by subsidiary undertakings in the
year ending 30 April 2003.
28 Capital commitments
At 30 April 2002 capital commitments in respect of purchases of rental equipment totalled £8.6m (2001 - £33.9m), all of which
had been ordered. There were no other material capital commitments at the year-end.
29 Related party transactions
During the year Sunbelt Rentals Inc incurred £0.2m in the purchase of artwork, equipment decals and business cards from
Images Unlimited, a company controlled by the wife of Mr B Dressel, a director of the company. The amount due to Images
Unlimited at the end of the year was less than £0.1m.
Ashtead Group plc 61.
Notes to the Financial Statements
30 Employees
The average number of employees during the year was as follows:
North America
United Kingdom
Rest of World
31 Post balance sheet event
2002
3,807
2,578
8
6,393
2001
3,158
2,669
7
5,834
On 14 June 2002 the Company and its subsidiaries Sunbelt Rentals Inc, Ashtead Technology Inc and Ashtead Plant Hire
Company Limited entered into an accounts receivable securitisation programme under which the trade debtors of these
subsidiaries were pledged as security in return for non-recourse advances of up to £60m. Concurrently with the initial funding
of the programme on 20 June 2002 which raised £59.4m, £60m of commitments under the Company's secured bank loan
agreement were cancelled and repaid. The securitisation programme is committed until 1 June 2005, the same date as the
revolving advance portion of the Company's bank debt. Advances received under the programme will be accounted for as a
reduction in trade debtors.
Ashtead Group plc 62.
Seven Year History
Restated
Year
Year
to 30 April to 30 April to 30 April to 30 April to 30 April to 30 April to 30 April
1996
2000
2002
1997
1998
2001
1999
Year
Year
Year
Year
Year
In £m
Turnover
583.7
552.0
302.4
256.0
202.5
147.6
Depreciation
120.9
114.5
Operating profit+ •
Pre-tax profit+ •
81.3
28.9
91.1
43.7
66.8
57.5
46.6
63.3
46.3
38.6
48.5
40.7
35.7
Capital expenditure
113.8
237.7
158.2
145.7
153.4
33.1
29.2
27.4
98.9
95.9
21.2
19.5
18.3
61.0
Book cost of rental equipment
971.9
962.8
629.5
527.9
394.1
245.6
172.2
Net cash inflow from
operating activities
202.0
173.0
111.4
89.1
77.6
56.5
33.1
Shareholders' funds
194.5
202.1
236.8
207.5
151.3
119.9
107.7
In pence
Dividends per share
In percent
Depreciation (% of turnover)
Operating profit margin+ •
Pre-tax profit margin+ •
People
Employees at year end
Locations
Profit Centres at year end
3.50
3.50
3.16
2.70
2.30
1.825
1.52
20.7
13.9
5.0
20.7
16.6
7.9
22.1
19.0
15.4
24.7
18.1
15.1
23.9
20.0
17.6
22.4
19.8
18.6
22.1
20.3
19.1
6,545
6,043
3,930
3,735
3,174
2,268
1,968
463
443
352
341
275
181
164
+ Before exceptional items and goodwill amortisation and the non-recurring salary costs of £2.5m paid to redundant former
BET USA employees before they were made redundant in the year 30 April 2001.
• The results for the years up to 30 April 2000 were restated in 2000/1 to reflect the adoption of
new accounting policies and estimation techniques under FRS 18 in that year.
Ashtead Group plc 63.
Who we are
Senior staff -
Sunbelt
Directorate
Bruce Dressel
Kurt Kenkel
Charles Miller
Brendan Horgan
Cliff Miller
Rod Nease
Randy Nelson
Earl Rose
Brian Tate
Trading Managers
Bradley Anderson
Carlos Aquino
Jeffrey Bair
Kenneth Beck
Douglas Bertz
Russ Brown
Steven Brown
Patrick Connolly
Eddie Dempster
Mark Ellis
Duane Francis
David Glaser
Kyle Horgan
Lon Jenkins
Chad Maughan
Paul Nicely
Christopher Pera
Greg Schamel
Kenneth Smerz
Donnie Smith
Thomas Wall
Jason Wallace
Frederick Weidner
Wayne Young
Support Managers
CMIS
Mark Long
Paul Hartland
Finance
Cheryl Black
Mike Godsey
Ron Matley
Matt Reinhard
Pump & Power
Services
Jeff Cooper
Eric Eaton
Scott Webb
Performance
Standards
Dawn Atkins
Jonathan Dalton
Bonnie Everett
Donna Nicely
James Parrish
Robert Swingle
Ollie Windle
Chris Watson
Training
James Cowley
Jeff Stachowiak
Steve Costantini
Chip Brunt
Bill Moertel
Marketing Services
Brad Lull
Jake Stout
Mary Roberts
Brett Bigham
Strategic Account
Sales
David Titus
Rob Murn
Steve Heyman
Ken Rothmel
Al Kabo
Danny Grimes
Safety and Risk
Management
Byron Adkins
Chuck Leeper
Brad Palmer
Darrylle Hood
Matt Harding
Scaffold Services
Peter Casey
Keith Lane
Francis Lombardi
Bruce Williams
Profit Centre
Managers
Jeff Adair
Kenneth Allen
Brent Anderson
Charles Ambrose
Craig Ambrose
Paul Anthony
Jaime Aquino
Tim Ardell
Timothy Atkins
Douglas Atkins
Michel Axline
William Bacon
Stephen Bailey
Michael Barrow
Christopher Belcher
Keith Bengtson
Peter Blaikie
Kent Borror
James Bradley
Greg Brewer
Clarence Browder
Conway Brown
Scott Brown
Alan Buchanan
Bryan Bumpus
John Calvano
Richard Carpenter
Jeffrey Casto
Randy Clark
Jeffrey Coscia
Tim Cousino
Douglas Davidson
Roger Day
James Dennis
James Deutsch
David Dicks
Andrew Dixson
Ralph Douglas
John Drew
Christopher Dulnik
Larry Eason
Miles Edge
Stephen Edwards
Brian Elbrecht
Everett Evans
James Faulkner
William Fish
James Fitzpatrick
Gregory Flanagan
Troy Fleming
Verland Fluharty
Cristopher Follett
Gregory Frost
Bruce Funderburgh
Robert Furr
Donald Furr
Michael Gervasini
Samuel Glova
Jason Goldberg
James Grech
Jeffrey Groundwater
Bryan Hadley
Samuel Harding
James Hartsfield
Roberta Hassele
Stephen Hassett
Daniel Heselton
Andrew Hewitt
Sara Hinsey
Barry Holdcroft
Christopher James
Jared Jansen
Joseph Johnson
Kirk Johnson
Robert Jones
Robert Kaczenski
Thomas Kagey
Jacco Kappers
David Kenyon
David King
Jeffrey Labenski
Dwayne Landry
Keith Lee
Robert Longello
Steve Lowder
David Lytle
Chris. Macey
Steven Martucci
William Mather
John May
Christopher Mayer
Todd Mayer
Kenneth McBride
Cynthia McBride
Jacquelyn McCoy
Scott McCoy
David McGlone
Joseph McIntyre
Scott McLeod
Tom Meeuwsen
Stephen Mick
Richard Minton
Brian Morrison
David Morse
Richard Morse
Robert Morse
Richard Moss
Wayne Myers
Clark Neff
Paul Neff
Richard Newbold
Carey Nicholson
Shawn Olmstead
Brandon Owens
Billy Page
Ricky Parker
Richard Parr
Russell Pate
Rodney Patterson
Russell Pavur
Steven Peterson
Carl Pierce
Donald Pline
Michael Poteete
Charles Powell
Paul Rice
Hugh Rickles
Christopher Ritz
Curtis Rogers
Richard Rollason
Albert Salchenberg
Jared Sampson
Kyle Sandidge
Court Sawyer
Larry Schaff
Bradley Schlottman
Steve Seelbach
William Sentelle
John Sepa
Brent Sexton
Jerry Shaw
Ryan Sherwood
Jamie Simmons
William Sinclair
Douglas Smith
Scott Smith
Timothy Smith
William Smith
Kurtis Specht
Todd Staley
James Stallings
Robert Stinson
Richard Suarez
John Suberbielle
Paul Syverson
Thomas Tegner, Sr.
Scott Telford
Gunner Thompson
Jason Thompson
Johnny Tippie
George Tompkins
Bruce Turner
Michael Varnell
John Vedok
Douglas Wallace
Richard Wallace
Thomas Walton
Chris Wear
Russell Weidner
Kevin White
Mark White
Jude Yimin
James Yonce
Lawrence Zellner
Wendy Zielinski
Dirk Zienow
Gregory Zoeller
David Zoss
Ashtead Group plc 64.
Who we are
Senior staff -
A-Plant
Mark Siney
Steve Westhead
Directorate
Sat Dhaiwal
John Bankes
Richard Dey
Tony Durant
Paul Fereday
Paul Mooney
Mark Sharkey
Gary Thompson
Bob Watts
Richard Winfield
Support Managers
Marketing &
National Sales
Mike Abbott
Maria Congreve
Marc Daley
Steve Doughty
Tony Grimshaw
Seamus Kelly
Carli Milsom
Tony Reynolds
Keith Robertson
Barry Stephens
Tim Tait
Legal
Paul Edmunds
Training
John Devonport
Tom McNeill
Derek Purdon
Transport Services
Paul Green
Performance
Standards
Ian Armstrong
Bob Harper
John Helliwell
Serena Lucas
Mel Moore
Chris Ryan
Dale Thurnham
George Winker
Finance
Sue Carey
Colin Foster
Iain Guthrie
Anne Hopkins
North
Ian Cass
Paul Dennis
Bob Dixon
Dave Mellor
Steve Pickering
Derek Stewart
Midlands
Steve Day
Chris Muirhead
Jason Newell
Yas Swindell
South
Karl Dunstan
Susan Files
Dick May
Richard Mills
Penny Noad
Derek Smith
Ashley Tarrant
Ireland
Bert Benson
John Owens
Specialist Products
John Crook
Mike Dixon
Kevin Foord
Peter Fearn
Dave Jones
Jim Jones
Michael Thistlethwaite
Profit Centre
Managers
Vince Akers
Mick Allen
Kamal Amanullah
Tony Andrews
Mark Antoine
Nigel Arnott
Simon Ashby
Tony Ashton
Brian Aspin
Mark Atkins
Ken Bailey
Neil Bailey
Sarah Barber
Alan Barnes
Barry Barnes
Kevin Barrett
Mark Barron
Vince Barry
Andy Benham
Barry Bevis
Wayne Bolton
Dave Bone
Darren Brady
Phil Briggs
Steve Buckley
Jim Buffoni
Richard Bull
Helen Bullock
John Bunting
Mark Burdge
Paul Burns
Andrew Burrows
Mandy Buss
Sean Byrne
Dean Cable
David Cadwallader
Mike Caesar
Olga Carroll
Sharon Carruthers
Adrian Chapman
Lorraine Cavanagh
Andy Chatham
Richard Clark
Ciaran Clancy
Peter Clay
Gary Clements
Len Clough
Tommy Coates
Scott Cooper
Steve Cornforth
Dean Corthorn
David Creasey
Mike Crumpton
Andy Cullen
Phil Davies
Douglas Davy
Jim Denihan
Alistair Dickson
Brian Dillon
Russell Dodd
Pete Dodds
Darryl Doherty
Martyn Dolan
Craig Donley
Andy Douglas
Barney Duffy
Matt Duggins
Paul Dukes
Graeme Dunlop
John Dunne
Jane Dyckoff
Matthew Eames
Nick East
Dean Edwards
Jim Edwards
Steve Elkington
Tom Fenton
Ross Fitzgerald
Eddie Ford
Jamie Fountain
Richard Freeman
Brian Galt
Jane Garfield
Clive Gilbert
Fraser Gillespie
Eddie Gilmore
Scot Graham
Jamie Grant
Jonathan Greenwood
Tom Grieve
Dave Griffiths
Dean Groves
John Guthrie
Eric Gwynne
Dermot Hagerty
Anthony Hales
Gary Hallam
Daren Hallas
John Hansbury
Tony Harrison
Richard Hart
Peter Hayward
Graham Hewitt
Douglas Hill
Tony Holland
Doug Hoskins
Marianne How
Phil Howell
Mark Huckle
Dale Hudson
Michael Hufton
Steve Hulley
Howard Hunt
Ian Jackson
Scott Jamieson
Jesse Johal
Ian Johnson
Mark Jones
Ian Jordan
Paul Keenan
Steve Kelf
Maria Kennedy
Terry Kingcott
John Kingham
Haydn Kinsey
Jason Kinsey
Gary Kirby
Ian Knight
Martin Lambert
Robbie Lamond
Mark Laud
Paul Lewis
Leon Lippett
Richard Llewellyn
Colin Lockless
Alex Love
Martin Ludkins
Jon McCarthy
Paul McClusky
Kevin McDade
Bill McGuckin
Alex McGuffie
Lisa McMahon
Andy Mackey
Wayne Maddocks
Steve Matthews
Shaun Medd
David Meek
Colin Meikle
Sean Mercer
Mike Merrigan
David Methven
Graham Milne
Kevin Mitchell
Bob Mitchinson
Peter Molloy
Martin Moody
Stephen Morell
Jim Morrison
Keith Moss
Joe Murphy
John Murray
Ian Needham
Dyllis Newman
Ian Nicholls
Andy Nightingale
Hamish Oliphant
Mike Omond
Jim Oliver
Gary Orton
Jim Palmer
Richard Parry
Mandy Payton
Dave Pearcy
Alan Peck
Graham Peel
Andy Perchard
Paul Perks
Michael Phelan
Alan Plant
John Plumb
Lee Prince
Alan Purdie
Mike Purdy
David Quantril
Steve Raper
Jim Reed
Norman Riches
Lee Rigby
Julian Ring
Dave Roberts
Denny Robinson
Adrian Rose
Shaun Ryan
Kevin Sanderson
John Savage
Sean Scarah
Chris Schaschke
Andy Scott
Mark Scutt
Keith Simpson
Nat Singleton
David Skyner
Mark Skyner
David Smith
Leslie Smith
Paul Smith
Robin Smith
Steve Smith
Peter Stalker
Cornal Stewart
Ian Stewart
Bill Stoodley
Ruth Swain
Colin Tall
Gordon Taylor
Jane Taylor
Keven Theobald
Karen Thomas
Andy Thompson
Ian Thompson
Jason Thorne
Carl Tidey
Steven Tinsley
Paul Trantum
Jamie Trevis
Andy Tribble
Andy Varley
Jamie Vincent
Wilson Walker
Gary Ward
Graham Ward
Steven Welling
Metro Werezak
Brian White
Colin Wight
Mike Wigley
Martin Williams
Mark Wilson
Mike Wishart
Lawrence Woodward
Roy Woods
Simon Yarwood
Ashtead Group plc 65.
Who we are
Senior staff -
Ashtead
Technology &
Corporate Office
Support Managers
Marketing & National
Sales
Chris Echols
Lorraine Monteiro
Colin Erskine
Ashtead Technology
Corporate
Rob Phillips
Peter Simpson
Singapore
Neil Christie
North America
Andy Holroyd
Wendy Zielinski
Michael Klembus
Doug Allen
Steve Rozunick
Tony Barreca
UK
Andy Doggett
Finance
Iain Guthrie
Mary Ruth Carlton
Technical
Mark Emslie
Ian Harvey
Dave Thomson
Ashtead Group plc
Corporate Office
Leatherhead
Robert Clark FCA ATII
Company Secretary
Ritain Patel ACCA
Group Financial Controller
Emily Shotter PhD ATII
Group Taxation Manager
CMIS
Derrick Adamson
Andrew Wortley
Ashtead Group plc 66.
Where we are
Locations -
Sunbelt
Alabama
Birmingham
Birmingham Access
Birmingham AWP
Mobile
Mobile Pump & Power
Allegheny
Ashland
Charleston
Charlottesville
Roanoke
Winchester
California
Belmont
Concord
Fontana
Fresno
Fresno Access
Glendale
La Mirada
Sacremento
Capital
Frederick
Fredericksburg
Gaithersburg
Manassas
McLean
Northern Pile Driving
Springfield
Sterling
Central
Charlotte
Charlotte Access
Charlotte AWP
Charlotte Pump & Power
Concord
Gastonia
Hickory
Indian Trail
Lake Wylie
Mooresville
Pineville
Rock Hill
Central Florida
Convention Services
East Orlando
Lake Fairview
Mid City Orlando
Orlando
Orlando Access
Orlando AWP
Orlando Pump & Power
Orlando Traffic Safety
Sanford
Titusville
Wintergarden
Coastal
Little River
Myrtle Beach
Wilmington
Wilmington Access
Wilmington Industrial
Resources
Coastal Atlantic
Charleston
Charleston Access
Coastal Pump & Power
Hilton Head
Savannah
Summerville
Delaware Valley
Pennsauken
Philadelphia
Southampton
South Jersey Pump &
Power
Swedesboro
Eastern Central
Evansville
Granite City
Indianapolis
Kokomo
Lansing
Layfayette
St Louis
South Bend
Toledo
Florida Gulf
Ft Myers
Ft Myers Access
Ft Myers Mast Climbers
Oldsmar
Tampa
Tampa Access
Tampa AWP
Tampa Pump & Power
Inland Mountain
Boise
Las Vegas
Tempe
West Valley Access
West Valley AWP
Mid Altantic
Durham
Fayetteville
Greensboro
Raleigh
Raleigh Access
Raleigh AWP
Wake Forest
Winston Salem
Winterville
Northern
Baltimore
Baltimore Washington
Access
Finsburg
Hunt Valley
Laurel
Maryland Pump & Power
Parkville
Waldorf
Washington
North Florida
Brunswick
Imeson Park
Jacksonville
Jacksonville Access
Jacksonville AWP
Jacksonville Pump &
Power
Orange Park
West Jacksonville
North Georgia
Atlanta Access
Atlanta Pump & Power
Atlanta AWP
Augusta
Augusta Access
College Park
Conyers
Douglasville
Lake Lanier
Macon
Marietta
Mid Town Atlanta
Norcross
North Texas
Arlington
Austin
Dallas
Kyle
Ohio Valley
Cincinnati
Clarksville
Columbus
Dayton
Lexington
Louisville
Louisville Access
West Columbus
Oregon
Albany
Eugene
Gresham
Hillsboro
Portland
Salem
Southern VA
Chesapeake
Chesapeake Access
East Richmond
Newport News
Richmond
Richmond Access
Richmond AWP
Virginia Beach
VA Beach Pump & Power
West Creek
South Florida
Ft. Lauderdale
Pembroke Pines
South Florida Access
South Florida AWP
South Texas
Beaumont
Houston Access
Houston AWP
San Antonio
Tennessee
Clarksville
Decatur
La Vergne
Nashville
Nashville Access
Nashville Pump & Power
Rivergate
Upstate South
Carolina
Augusta
Columbia
Florence
Greenville
Spartanburg
Washington
Kent Access
Kent AWP
Lakewood
Lynwood
North Bend
Pasco
Redmond
Seattle Pump & Power
Tacoma
Woodinville
Western Central
Bloomington
Chicago Pump & Power
Decatur
Des Moines
East Peoria
Joliet
Moline
Locations -
A-Plant
North West Tool
Blackpool
Ellesmere Port
Liverpool North
Liverpool City
Manchester UK
Oldham UK
Salford
Stockport UK
Warrington
Worsley
North West Plant
Astley
Barrow
Carlisle
Deeside
Dumfries
Egremount
Kendal
Liverpool
Preston
Reddish
Whitehaven
Scotland East
Aberdeen St Machar
Dundee
Dundee Main Road
Earlston
Edinburgh
Edinburgh Main
Ladybank
Inverness
Perth
Ashtead Group plc 67.
Where we are
Scotland West
Ayr
Cumbernauld Tool
Falkirk
Glasgow Anniesland
Glasgow Baillieston
Glasgow South
Glasgow Traffic
Kilmarnock
Stevenson
North East Tool
Doncaster
Gateshead
Hartlepool
Hull City
Leeds UK
Leeds City
Sheffield City
Scunthorpe
Sunderland
Teeside TH
Tyneside
Wetherby
North East Plant
Bradford Tool
Bradford TS
Hull
Immingham
Leeds
Leeds Stanningly
Middlesbrough
Newcastle
Rotherham UK
Sheffield
Teeside MP
York
South East Plant
Barking
Battersea MP
Canterbury
Charlton
Ford
Leatherhead
Maidstone
Medway
New Cross
Romford
Southampton
Staines TT
South East Tool
Arundel
Basildon
Fareham
Gatwick
Heathrow
Leatherhead TH
Lancing
Maidstone
Southampton City
London Tools
Battersea TH
Bow TH
East London
Luton
Southwark
Staples Corner
Watford TH
Thames Valley &
West
Bridgend
Bristol Central
Cardiff
Cardiff City
Colnbrook TM
Heathrow MP
Milford Haven
Newport
St Phillips
Swansea
Swindon
Thatcham
Northern Home
Counties
Aylesbury
Bedford
Bedford TM
Cambridge
Colchester
Epping
Hemel Hempstead
Ipswich
Long Stratton
Letchworth
Milton Keynes
Norwich
St Albans
Watford
Westerfield
South West Plant
Barnstaple
Bodmin
Bridgwater
Exeter
Plymouth
Plymouth
Weymouth
North Midlands Tool
Burton TH
Chesterfield North
Derby North
Derby South
Grantham
Heanor
Kesteven
Leicester City
Lincoln City (Tool)
Loughborough Central
Newark
Nottingham East
Nottingham West
North Midlands
Plant
Boston
Burton
Chesterfield South
Derby Ascot
Leicester
Leicester Central
Lincoln
Loughborough TM
Loughborough
Mansfield
Nottingham
Nottingham Central
Sleaford
Midlands Plant
Cheltenham
Coventry
Northampton Central
Nuneaton
Oldbury
Rugby
Stoke
Telford
Walsall Wood
Wolverhampton
Worcester
Midlands Tool
Birmingham City
Corby
Coventry City
Donnington
Erdington
Hunsbury
Shrewsbury
Stoke City
Stoke Fenton
Tamworth TH
Wolverhampton Tool
Ireland General
Plant
Carlow
Cork
Dublin Main Plant
Dublin Rail
Dublin Tools
Galway
Limerick
Lisburn
Ireland Specialist
Plant
Belfast Acrow
Cork Acrow
Dublin Acrow
Galway Acrow
Lisburn Rentarc
A-Plant Specialist
Products
Acrow
Aberdeen Acrow
Bristol Acrow
Cardiff Acrow
Chesterfield Acrow
Colnbrook Acrow
Edinburgh Acrow
Glasgow Acrow
Leeds Acrow
Liverpool Acrow
Manchester Acrow
Newcastle Acrow
Norwich Acrow
Romford Acrow
Tavistock Acrow
Walsall Acrow
Groundcare
Abergavenny
Irvine
Manchester
Newcastle (Dunston)
Peterborough
Storrington
Big Air
Bridgend
Derby
Stockton
Rail
Avonmouth
Derby
Manchester
Norwich
Romford
Scotland (Perth)
West London
Powered Access
Aberdeen
Avonmouth
Birmingham
Brentwood
Brentwood Masts
Bridgend
Kendal
Kilmarnock
Leeds
Manchester
Northampton
Nottingham
Southampton
Stockton
Tamworth
West London
Accommodation
Alresford
Ampthill (Bedford)
Basildon
Boroughbridge
Bridgend
Exeter
Kilmarnock
Lincoln
Maidstone
Manchester
Nottingham
West Midlands
Power Generation &
Rentarc
Aberdeen
Barton
Birkenhead
Cambridge
Carlisle
Derby
Eastleigh
Lowestoft
Manchester
Newmains
Newport
Salford
Stockton
Walsall (West Midlands)
Pumps
Falkirk
Manchester
Leeds
Preston
Romsey
Tottenham
Ashtead Group plc 68.
Future dates
2002 Annual General Meeting
20 September 2002
Payment of final dividend
30 September 2002
Payment of interim dividend
7 April 2003
2003 Annual General Meeting
26 September 2003
Robert Clark, FCA, ATII
Company Secretary
Registered Office
Ashtead House
Business Park 8
Barnett Wood Lane
Leatherhead
Surrey KT22 7DG
Corporate Office
King’s Court
41-51 Kingston Road
Leatherhead
Surrey
KT22 7AP
Registered number: 1807982
Designed & produced by DS Marketing
King’s Court
41-51 Kingston Road
Leatherhead
Surrey KT22 7AP
www.ashtead-group.com
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